Economic Data and Yen Weight the Nikkei
Japanese stock market, the Nikkei, dropped sharply in trading today following the release of the data that is lower than the estimate. The strengthening of the yen also weighed on the performance of the stock down.
Bank of Japan reported a quarterly survey that assesses the sentiment of a large manufacturing company to current economic conditions. Commonly called Tankan index indicates the number 12 in the survey in March. The number is the same as the survey last December, and lower than the estimate of economists surveyed by the Wall Street Journal for 12.
While the yen is currently trading strengthened the range of 119 per dollar, the yen benefited from the decline in global stock markets.
From the trading floor, Toyota Motor fell 1.8%, and Nissan Motor down 2%. Shares of Fujitsu Ltd. and Canon Inc. each lost 1.3%. The headline Nikkei index fell 1.27% to 19090.77. While the Nikkei futures traded in the range of 19 035 at 8:21 pm, with daily highs and lows 19 275 18 935
Technically, the index on the trading session today, Wednesday (01/04) likely to weaken, test negative trends, the impact of Wall Street. At the M15 chart bearish engulfing formation provides opportunities for the index to move downside. However, the volume tends to rise, early indications bullish index. In addition, RSI, the M15 chart, are oversold, signaling upside.
It is estimated, the index test the first support level that is 18990 and 18900. If it fails in 19050, we then estimated the index tends to retest the resistance level that is 19 080 and continued until the possibility of being in the 19130 area.
Yen Gains Ahead of Japan Data
Trading foreign exchange on Wednesday (1/4), observed the yen strengthened against the US dollar ahead of the release of a report of manufacturing and non-manufacturing Japanese Tankan today.
Ongoing trade in the Asian session, the USDJPY fell of 0.05% at 120.08 level where the pair was observed to hit a daily low of 119.99 for the session and the highest level of 120.14 for the session daily.
The yen strengthened against the US dollar looks this morning, when the market is waiting for the results of the report and the non-manufacturing index Tankan manufacturing scheduled to be released at 6:50 pm Jakarta time.
Survey of economists had forecast that the Tankan manufacturing index will rise, seasonally adjusted at level 14 in the first quarter, while for the non-manufacturing index Tankan will increase, seasonally adjusted to 17 in the first quarter.
Along with the economists’ forecasts, a stable state in the manufacturing sector and the index of non-manufacturing Japan should not make a threat to the natural weakening of the yen to the US dollar, but will lead to the strengthening of the Japanese currency. However, if the results show a decline in the index of manufacturing and non-manufacturing, then it could push the yen to weakened.
Technically, the trading session today, Wednesday (01/04), the dollar yen pair a chance to move in the negative trend.
The weakening of the yen mainly expected soon reexamine the minimum support at 119.00 and 118.40 maximum. Meanwhile, if the Yen was able to break and hold above 119.60, then the other alternative scenario that Yen chance to test resistance in 119.90 and 120.30 area.
Dollar Drop in Oil Prices Make Gold Prices Hit
At the end of US trading commodity exchange gold prices had a significant reduction (1/4). Gold prices fell pressured by a rise in the exchange rate of the US dollar and weaker crude oil prices. And with growing expectations that the Fed will raise its benchmark interest rate this year gold price to record monthly decline eroded both.
Gold prices have declined by 3 percent after the precious metal commodity prices reached the highest position in the past three weeks last week. The weakening of the gold price occurred after Janet Yellen signaled that the benchmark rate could happen this year.
Yellen statement that indicates that the economic recovery in the United States has been continuous. Gold prices had rallied for seven consecutive sessions eventually hit by a potential increase in the benchmark interest rate.
Spot gold prices in late trading Wednesday morning closed at 1188 dollars per troy ounce. The precious metal prices posted a decline of 0.2 percent.
While the price of gold futures for April contract which is the most active contracts also decreased. The price of gold futures fell 1.70 dollars to the position of 1184.80 dollars per troy ounce.
Analyst estimates that the spot gold price movements today LLG will again decreased although it will tend to be limited. Precious metals price movements have the potential to weaken as market participants started back after the US dollar and leave the safe-haven assets such as gold.
In this har day trading price of gold could potentially test the resistance level at position 1194 dollars per troy ounce. If successfully penetrated the price will continue to rise again to the position in 1200 dollars. Meanwhile, if there is movement which turned lower price will test the support level at the position in 1180 dollars. If successfully penetrated the price will continue weakening to the position in 1170 dollars.
Technically, gold trading session today, Wednesday (01/04) potential reversal, tested positive trend, but prone to taking profit. RSI indicator tends to re-test resistance and aiming the bullish channel, but Bollinger Bands that began to shrink, thus giving impetus to the gold to the downside.
It is estimated that the gold price immediately prior to test resistance in the area of at least 1183.10 and re-test the maximum level of 1188.50. However, if the price of gold was unable to break and stays below 1187.90 then estimated the price of gold could potentially test the 1180.50 and 1178.10 Support.
