Asian equities have soared following the footprints of the S&P500. (Pivot Orderbook analysis)

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• Asian equities have soared following the footprints of the S&P500.
• A noteworthy decline in US inflation has brought a global market rally.
• Nikkei225 has been delighted amid a sharp recovery in the Japanese yen.

The pair currently trades last at 27979.88.

The previous day high was 27991.19 while the previous day low was 27371.64. The daily 38.2% Fib levels comes at 27754.52, expected to provide support. Similarly, the daily 61.8% fib level is at 27608.31, expected to provide support.

Markets in the Asian domain are displaying bumper gains after sensing ultra-bullish cues from the US equity market. S&P500 soared like there is no tomorrow after a sheer decline in US inflation for October. Investors flushed money into the risk-sensitive assets as a slowdown in inflationary pressures could result in a slowdown in policy tightening by the Federal Reserve (Fed).

At the press time, Japan’s Nikkei225 soared 2.74%, ChinaA50 climbed 2.24%, Hang Seng upsurged 5.57% and Nifty50 gained 1.53%.

Market euphoria brought a bloodbath in US Treasury yields as investors rushed toward US government bonds by dumping the US dollar index (DXY). The 10-year US Treasury yields plummeted to 3.81% while the DXY plunged to near a two-month low of around 107.70.

The headline inflation rate dropped to 7.7% vs. the projections of 8.0% while the core Consumer Price Index (CPI) declined to 6.3%. A cool off in red-hot inflation was highly expected as consumer spending slumped to 1.4% in the third quarter, as recorded from Fed’s Beige Book.

Japanese equities have rebounded amid a significant appreciation in the Japanese yen vs. the mighty Greenback. A prolonged weaker yen has been hurting firms that are highly dependent on raw materials imported from external economies. Now, a relief rally in the domestic currency will support corporate and eventually their profit margins.

On the oil front, oil prices have recovered above $86.00 as inflationary pressures have been curtailed and recession fears have been postponed. This has brought a sense of optimism in the oil demand prospects. Also, investors are shrugging off Covid-related risk in China.

Technical Levels: Supports and Resistances

XTIUSD currently trading at 27979.88 at the time of writing. Pair opened at 27979.88 and is trading with a change of 0.0 % .

The pair remains strongly bullish on the daily timeframe. It trades above its 20 SMA @ 27358.96, 50 SMA 27287.9, 100 SMA @ 27418.7 and 200 SMA @ 27150.73.

The previous day high was 27991.19 while the previous day low was 27371.64. The daily 38.2% Fib levels comes at 27754.52, expected to provide support. Similarly, the daily 61.8% fib level is at 27608.31, expected to provide support.

Note the levels of interest below:

• Pivot support is noted at 27570.62, 27161.35, 26951.07
• Pivot resistance is noted at 28190.17, 28400.45, 28809.72

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