Asian Stock Market: Nikkei225 nosedives on BOJ intervention, oil establishes below $80.00 (Pivot Orderbook analysis)

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The pair currently trades last at 26631.4.

The previous day high was 26993.32 while the previous day low was 26478.1. The daily 38.2% Fib levels comes at 26674.91, expected to provide resistance. Similarly, the daily 61.8% fib level is at 26796.51, expected to provide resistance.

Markets in the Asian domain are displaying a wide divergence in performance as the Japanese equities are facing an intense sell-off amid the Bank of Japan (BOJ)’s intervention in the currency markets while Chinese equities are performing firmer despite the house arrest of the Chinese leader Xi Jinping.

At the press time, Japan’s Nikkei225 plummeted 2.55%, ChinaA50 jumped almost 1% while Hang Seng eased 0.20%.

An intervention in the currency markets by the BOJ has cleared that the economy is worried about the depreciating yen, which has forced investors to dump equities belonging to export-oriented firms and the tourism industry as their revenue will fall ahead. Meanwhile, Jibun Bank PMI numbers have failed to make any impact.

The Manufacturing PMI has trimmed to 51.0 against the expectations of 51.1 while the Services PMI has accelerated to 51.9 against the forecasts of 49.3.

Chinese indices are performing well despite the signs of political instability. The House arrest of Chinese leader Xi Jinping has underperined risk-off market mood.

The US dollar index (DXY) is facing barricades around 114.00, however, the odds are favoring recapturing the two-decade high of 114.52.

On the oil front, a fresh rate hike cycle by western central banks has bolstered the chances of a global recession. In order to corner the soaring price pressures, central banks are accelerating interest rates vigorously despite knowing the fact that their economic fundamentals are not supportive. Higher interest rates will for sure trim the overall demand and eventually the demand for oil.

Technical Levels: Supports and Resistances

XTIUSD currently trading at 26631.4 at the time of writing. Pair opened at 26631.4 and is trading with a change of 0.0 % .

The pair remains strongly bearish on the daily time frame. It trades below the 20 SMA @ 27715.46, 50 SMA 27915.7, 100 SMA @ 27321.93 and 200 SMA @ 27342.93.

The previous day high was 26993.32 while the previous day low was 26478.1. The daily 38.2% Fib levels comes at 26674.91, expected to provide resistance. Similarly, the daily 61.8% fib level is at 26796.51, expected to provide resistance.

Note the levels of interest below:

• Pivot support is noted at 26408.56, 26185.72, 25893.34
• Pivot resistance is noted at 26923.78, 27216.16, 27439.0

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