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Emerging markets around the world have pushed to higher and higher record levels. They're now being joined by their more mature cousins - such as DJI, S&P 500, and DAX. Technical analysts often use previous support level as resistance, or use channels to project resistance points. But with so many markets in blue sky territory at what point will clouds form on the horizon? Is the next major pull-back close at hand, or a long way off ... or maybe both? But not all major market indexes are at new highs. There's two major markets that are still way below their all-time highs, and could help us see where the next bands of resistance lie. One is from USA the other from Japan: * NASDAQ 100 (NDX) is sitting near 2030 - well below its all-time high near 4800. * NI225 - Nikkei 225 Index, Japan - is sitting at 18,220, less than half of its all-time high set way back in 1989 at 38,957. Looking at NI225 first, it could easily push another 10% higher, but should face a major wall of resistance in the 19,500 - 21,000 range and this could well form the range for a long-term high. If NI225 is to retrace 50% of its 14 year decline, it will eventually carry to 23280, but 20,000 - 21,000 is likely to provide an insurmountable hurdle on the first attempt. Meanwhile, NDX will have retraced 50% of its decline at 2800, about 38% above todays 2030 level. It also has strong resistance much nearer at hand - at the 2080 level. If it pushes passed this level then the next resistance point is near the top of the trading channel at 2191. So be prepared for the rally to falter as NI225 approaches 20,000 and/or NDX gains another 50 points to near 2080.
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Murray Nickel is a mathematician, statistician, and professional trader. He offers a free trial of trading signals for global market indexes and index ETFs, spot Forex, and spot Gold. He also mentors traders aiming to build consistent success at trading global markets. This and other unique content stock markets articles are available with free reprint rights.
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