Nikkei

USD/JPY and Nikkei 225 futures are surging in Asia, benefitting from a market recalibration of how much the Federal Reserve is likely to cut interest rates next year. The weaker yen is helping to boost sentiment surrounding Japanese exporter earnings, seeing Japan’s benchmark equity index knocking on the door or key resistance.

Nikkei futures look like a market where bulls and bears are waging war, all while the price continues to coil up within a symmetrical triangle, waiting for a potential explosive break.

The rebound on Wall Street indices on Wednesday gave an extra spring in the step for APAC equities today. But can the Hang Seng and Nikkei extend their own rallies from here?

ASX 200 futures rose to a record high on Monday night, which could see the ASX 200 cash market gap higher and run for its own record high today. We're also looking at a potential bullish reversal on the Nikkei's 4-hour chart.

Wall Street indices snapped a 4-day losing streak on Monday and the US dollar recovered from its cycle lows, which could bode well for USD?JPY and the Nikkei 225.

The Japan GDP numbers are in and according to the Cabinet Office, Japan's economy grew by an annualised real 2.9% in Q2, which was revised down from an initial report of 3.1% due to lower-than-expected private consumption and capital spending within the country.

USD/JPY and Nikkei 225 have reclaimed important levels, benefitting from mounting evidence that fears over a looming US recession may have been premature. With the onus now on the data to prove the US economy is entering recession rather than isn’t, and with no major data out next week, you get the sense recent bullish moves may extend in the days ahead.

They may be poles apart geographically and their composition, but these two momentum-driven markets have morphed into avid US economic watches over the past month. That means if you want to get clues on directional risks next week beyond price signals, you better pay attention to the US economic calendar.

US interest rate expectations are becoming increasingly influential on Japan’s Nikkei 225, both through the FX channel impacting forecasts for exporter earnings and sentiment towards the outlook for global economic growth. Other factors, such as commentary from BOJ, come across as secondary factors for now.

Shinichi Uchida, Deputy Governor of the Bank of Japan (BOJ), says the bank won’t hike interest rates when markets are unstable, delivering a clear message on what traders need to do to prevent them doing so again: create volatility.

I don’t blame traders for panicking in markets like these. There’s so much noise and so much hysteria, usually accompanied by countless charts resembling waterfalls. But one thing experience brings you is the ability to step back and look at the things that matter to gauge whether the panic is justified.