Market Brief: Festive Cheer Comes Early For Stock Bulls

A summary of news and snapshot of moves from today’s Asia session.

Equities Brief:

  • Asian stock markets are in “risk on” mood to celebrate a festive cheer with a treble of positive news flows; U.S. President Trump has approved the terms of the Phase One U.S.-China trade deal and suspended the additional 15% tariff on China products that are set to take place on 15 Dec, the U.S. Federal Reserve’s has expanded its repo programme to US$365 billion through Jan 2020 in the short-term funding market to prevent any disorderly funding squeeze and U.K PM Boris Johnson’s Conservative party that has won a majority in the UK snap general election that is likely to see greater clarity for Brexit.
  • Meanwhile, the latest Bank of Japan’s “tankan” quarterly survey has showed that big Japanese manufacturers’ business mode sank to a near 7-year low, the 4th consecutive quarter of decline.
  • The Nikkei 225 has shrugged off the lackluster “tankan” data and stage a magnificent rally of 2.64%, the best intraday performance seen so far in the past 10 days led by Basic Materials and Consumer Cyclicals stocks. These two sectors have gained by 3% and 2.44% respectively.  

Price Acton (derived from CFD indices):

  • Japan 225: Bullish breakout from 23650 medium-term range resistance in place since 07 Nov 2019. Short-term support now at 23780 (today’s Asian session gapped up) with further potential upside towards intermediate resistance at 24400 (01 Oct 2018 major swing high area).
  • Hong Kong 50: Underperformer in the past 6-month has surged as well. Short-term support now at 27100 (former minor swing high areas of 19/26 Nov 2019 with further potential upside to test the next intermediate resistance at 28000/2000 (former minor range support from 26 Jun/15 Jul 2019 & 61.8% retracement of the previous slide from 03 May to 15 Aug 2019 low).
  • Australia 200: Continued to be stuck inside a range bound configuration. Expect sideways movement between 6780 and 6670. Bulls need to have a break above 6780 for a potential push up towards 6840 intermediate resistance in the first step (former minor swing lows of 29 Nov/02 Dec 2019).
  • Germany 30: Bullish breakout above the 13350 medium-term range resistance in place since 19 Nov 2019. Eyeing the all-time high area of 13600/750 next in the first step with short-term support now at 13190 (former minor rang resistance from 05 Dec/09 Dec & minor ascending trendline from 10 Dec 2019 low).
  • US SP 500: Bullish breakout above 3147 minor descending trendline from 02 Dec 2019 and surged to a fresh new all-time high, printed a current intraday high of 3183 in today’s Asia session. Key short-term support now at 3155/3150(the former all-time high area printed on 28 Nov/02 Dec 2019 & lower boundary of a minor ascending channel from 03 Dec 2019 low) with a further potential upside to target 3200/220 next (Fibonacci expansion cluster & upper boundary of the minor ascending channel from 03 Dec 2019 low).

Data from Refinitiv. Index names may not reflect tradable instruments and not all markets are available in all regions.

Build your confidence risk free

More from Indices

Join our live webinars for the latest analysis and trading ideas. Register now

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.