Market Stability Observed as US Markets Remain Closed for Labor Day

In recent market activity, the Nikkei 225 index displayed minimal changes, reflecting stability in a period marked by reduced trading due to the Labor Day holiday in the United States. The FTSE 100 and the DAX 40 indices are also anticipated to experience limited movement as the US market remains shuttered.

On the preceding Friday, the Nikkei 225 successfully traded above the 55-day simple moving average (SMA) at 38,454 and the 200-day SMA at 38,477, overcoming a previous resistance that had persisted for two weeks. However, the index remains below the July high of 39,281, continuing to exhibit a range-bound trading pattern.

A notable technical threshold exists at the low of 37,817 from the previous week; a breach below this level could lead to a retest of the previous Monday’s low at 37,163 and potentially revisit the significant level of 36,000. Nevertheless, the immediate outlook remains cautiously positive as long as the August 19 low at 37,163 is maintained.

Meanwhile, the FTSE 100 index has retraced below its early August peak at 8,404. Last week, it briefly reached a three-month high of 8,419. The overall bullish pressure is expected to persist as long as the 20 August low at 8,240 holds firm, with the 55-day SMA positioned at 8,238 serving as a potential support level.

Additionally, the Dow Jones Industrial Average marked a record high of 18,971 last week, suggesting a potential revisit of this level on Monday. The psychological milestone of 19,000 could serve as a subsequent target for traders. Minor support can be observed between the peaks recorded in June to July, specifically from 18,786 to 18,782.