Dow and Nikkei surge, while Hang Seng faces downward pressure; key levels and trends analyzed for market insights.
The Dow Jones and Nikkei 225 indices exhibited strong rallies in the latest market developments, contrasting with the Hang Seng’s continued decline.
Dow Jones Bounces Back
Monday witnessed a robust rebound in the Dow Jones index, recovering from the recent session lows and reclaiming losses from the final two sessions of the preceding week. Analysts suggest a push to new record highs could be imminent, with the 38,000 level now within sight. This shift nullifies a short-term negative outlook and revives the uptrend, though caution is necessary due to potential overextension. Re-establishing a short-term negative perspective would require a reversal below 37,250 for the index.
Dow and Nikkei Surge, Hang Seng Down
Nikkei 225 Tests Recent Highs
The Nikkei 225 demonstrated further gains on Monday, propelling the index to November highs. A potential test of the 34,000 level appears on the horizon. Surpassing this mark would signify the index reaching its highest levels since 1989. This development marks the end of an extended consolidation period that has persisted since the end of June. Despite a 3% gain since last week’s low, a close below 33,000 is crucial for sellers to regain control in the short term.
Hang Seng Faces Downward Pressure
In contrast, the Hang Seng index resumed its downward trajectory after a brief rebound in late December. Gains faltered at the 50-day simple moving average (SMA), leading to a textbook reversal. Consequently, the index is retracing towards the December lows, marking its lowest since November 2022. Anticipate further declines as they head towards the November low at 14,640.
A revival above the 50-day SMA and 17,170, last week’s highs, is imperative for a potential short-term rebound. Until then, the Hang Seng index remains under pressure, highlighting this market segment’s challenges. Closely monitor these key levels for potential market shifts in the coming sessions, advises investors.