Nikkei Rallied Stalled, Honda Drops
Japan’s Nikkei index rallied for a fourth day to temporarily halt in trading today, investors seem to be cautious ahead of testimony chairwomen of the US Federal Reserve Janet Yellen, in front of the US Congress from today to tomorrow. At last week’s release of the minutes of the FOMC Fed more dovish than previously interpreted, however Yellen also likely to remind the market if a rate hike is still likely to rise in June.
From the floor of the stock exchange, shares of Honda Motor fell 1.2% after on Monday surprised the market by appointing Takahiro Hachigo, who currently serves as the managing officer, to replace Takanobu Ito as President and Chief Executive at the end of June. Other automotive company, Nissan and Suzuki also weakened, respectively 1.6% and 0.8%.
The headline Nikkei index currently flat the range 18464.33. While the Nikkei futures traded in the range of 18 460 at 7:55 pm, with daily highs and lows 18 485 18 425
Technically, the index on the trading session today, Tuesday (24/02) is likely to strengthen, test positive trend. At the M15 chart bullish hammer formation provides opportunities for the index to move upside. However, the volume of which is likely to increase, as well as an early indication of bullish index. In addition, RSI, the M15 chart, are oversold, signaling upside.
It is estimated, the index test the first resistance level of 18 550 and 18625. If it fails in 18495, we then estimated the index tends to retest the support level that is 18 450 and proceed to the possibility of being in the 18400 area.
Yen Subside Against US Dollar
Yen against the US dollar began to subside, Tuesday (24/2). Investors focused await a speech from Fed Governor of higher interest rates.
USDJPY rose to a level of 118.94% 00:11.
In the last week, the BoJ minutes showed that the board members had some concerns about the BOJ’s monetary policy scheme, involving the increase in base money by 80 trillion yen / year. Inflation remained at a low level, so there is concern that the BOJ may be reached inflation target back.
Then from the US market, where the speech of Jannet Yellen interpreted hawkish then the yen will appreciate, but on the contrary if the dovish then the US dollar will be stronger.
Technically, today’s trading session on Tuesday (01/02), the dollar yen pair likely to move in a positive trend.
A stronger yen is mainly expected to immediately re-examine the minimum resistance at 121.10 and 123.25 maximum. Meanwhile, if the Yen was able to break and stays below 119.06, the other alternative scenario that Yen likely to test support in 118.25 and 117.10 area.
Gold Weakens As Strengthening Dollar And Greek Debt Deal
Gold continued depressed weaken the US dollar strengthening, expectations of rising US interest rates, and a deal between Greece and its creditors. The dollar gained about 0.4% against the major currency pairs, making the price of gold becomes more expensive for investors with currencies other than US Dollars.
The loss of investor anxiety about the risk of a Greek default following the bailout aid 4-month extension, making investors turned their attention to the testimony of US central bankers to finance the US Senate on 24 February. Investors will pay attention to the signs of a rise in US interest rates for the first time in a decade.
The absence of trade in China, the world’s second largest gold consumer, who closed since Wednesday last week due to welcome the Chinese New Year, also be a factor depressing the gold trade. Gold was strengthened when the US housing data is lower than the prediction of anxiety raises the Fed will not hesitate to raise interest rates this year.
The price of gold so far in the range of the level of 1201, near daily lows 1188.13 and 1210.16 away from daily highs.
Technically, gold in today’s trading session on Tuesday (24/02) potentially bearish, tested negative trend back, but prone to reversal. RSI indicator tends to re-test support channel and towards the oversold area, but Bollinger Bands that began to widen, thus giving impetus to the gold to the upside.
It is estimated that the gold price immediately prior to test support in the area of at least 1197.33 and re-test the maximum level of 1192.73. However, if the price of gold is able to break and hold above 1201.40, the estimated price of gold could potentially test the 1203.40 and 1205.72 resistance.
