Nikkei 225 sees 22,500, equities continue to steadily eat away at January's decline

Nikkei lifting back into fresh highs after Japan returns to markets following the long weekend.
Japan's equities continue to climb as investors remain confident that interest rate increases are a long way off.

Joshua Gibson FXStreet

Japan's Nikkei 225 equity index is looking for a way higher, lifting back into the 22,500 area after Monday's US session plummet.

The Nikkei reached a three-month high yesterday while Japan was shuttered for the long weekend, and the index is continuing to trade on the high side as the Nikkei continues to press into the halfway mark of January's global equity snap.

Inflation expectations have been slumping in Japan as the Bank of Japan's (BoJ) super-easy monetary policies are beginning to have less of an inflation-causing effect as many had hoped, and Japanese equities continue to lift as market participants continue to shake off the fear of rising costs in the face of rising interest rates. The BoJ continues to remain stubbornly fixed on rates, and Japan looks unlikely to raise rates anytime in the near future.

Nikkei levels to watch

The index punched in a fresh high at 22,634 yesterday, and that figure could firm up as a resistance level if current action can't get the index to continue climbing, and support is looking thin to pump up any bearish corrections, with March's swing high at 22,100 with April's open at 21,450.

Author

Joshua Gibson

FXStreet

Joshua joins the FXStreet team as an Economics and Finance double major from Vancouver Island University with twelve years' experience as an independent trader focusing on technical analysis.

USD/JPY eyes August swing low, near 155.20 ahead of US NFP

USD/JPY retests the August monthly swing low during the Asian session on Friday as a more hawkish repricing of BoJ rate-hike bets and a suspected intervention continue to underpin the Japanese Yen. Meanwhile, the US Dollar is seen consolidating the previous day's heavy losses amid soft US bond yields, further weighing on the currency pair as traders keenly await the US NFP report.

AUD/USD consolidates above 0.7200; US NFP awaited

AUD/USD holds steady above 0.7200, near its highest level since mid-May, as bulls await the US NFP report for more cues on the Fed's policy path before placing fresh bets. Meanwhile, the recent decline in US bond yields keeps the US Dollar depressed near its lowest level in over a week and acts as a tailwind for the Aussie amid the RBA's hawkish tilt.

Gold tumbles as blockbuster US NFP lift US Dollar, Treasury yields

Gold (XAU/USD) falls sharply on Friday, snapping a two-day recovery after the US Nonfarm Payrolls (NFP) report surprised strongly to the upside. The metal briefly climbed above $4,500 on Thursday, gaining nearly 2%, but has since erased a large part of that advance.

Crypto’s $638 million buyback boom may not be as bullish as it looks

Decentralized Finance (DeFi) protocols reportedly spent $638 million to buy back their native tokens in August, up 17% from a year earlier. On the surface, the buyback trend suggests the cryptocurrency industry is maturing fast, adopting one of Wall Street’s oldest tools to bolster valuations and distribute revenue. The headline becomes less impressive once the number is opened up.

Why hawkish Bank of Japan expectations aren't enough to sustain the Japanese Yen rally

The Japanese Yen (JPY) experienced a sudden burst higher after falling back below the 160.00 psychological mark against the US Dollar (USD) earlier this week amid a more hawkish repricing of Bank of Japan (BoJ) rate hike expectations.

Diesel’s record $100 warning: The oil shock hiding in plain sight

The Oil market may look calmer than it did a few months ago, but diesel is sending a very different message. The US diesel crack spread, the premium of ultra-low sulphur diesel futures over WTI, recently surged above $100 per barrel for the first time, reaching an intraday record of just over $102.00.