This week, is it moving in a range of 27,000 to 27,580 yen
In this week's forecast, we expect the Nikkei to rebound along with the U.S. rebound, breaking through near-term highs of 27,053 yen on Wednesday the 18th and 27,072 yen on Friday the 6th of May, and testing the 27,580 yen level from April 21.
At the start of the week on Monday the 30th, following a sharp rise in the U.S. Dow at last Friday's close, the index clearly broke through 27,000 yen, rising to 27,401 yen in the latter part of the session (+619), and closing at 27,369 yen (+587), the highest level in about a month.
The next day, Tuesday the 31st, with the previous day’s U.S. market closed and lacking new catalysts, the upside reached 27,463 yen (+93) but failed to reach 27,500 yen, while the downside sank to 27,250 yen (−118), with a closing price of 27,279 yen (−89), a small pullback.
Today, Wednesday the 1st of June, with U.S. stocks retreating (the Dow at its first decline in seven days), Nikkei seemed to be moving in tandem at first, but after-hours U.S. stock futures rose and the yen weakened, it opened at 27,295 yen (+15), briefly rose to 27,482 yen (+202) as it challenged 27,500 yen, but failed to break through the 27,500 mark, ending at 27,457 yen (−178).
From now on for the next two days, whether the index can reach the 27,580 yen level mentioned earlier in this week will depend on U.S. stocks. The June U.S. equity market is expected to rise in anticipation of the FOMC meeting on the 14th–15th, but before that, attention is on the May employment report for May 3rd in the near term.
If U.S. stocks rise and the Nikkei breaks through 27,580 yen, the next level is 28,000 yen; however, once there, selling into rallies would intensify. If U.S. stocks rise until the June FOMC, the pattern could be an advance in early June followed by a decline in the latter half. While expectations of rate hikes have cooled and inflation concerns have subsided ahead of the FOMC, that is likely temporary.
× ![]()