Nikkei 225 finished lower while most of the Asian indices ended higher mirroring the strong finish from Wall Street. Uncertainty from the coronavirus outbreak remains the main theme despite the recent gains and encouraging Chinese manufacturing data. The PMI report was at 52, while the consensus estimate was 45, and the February reading was at a record low of 35.7. The Non-Manufacturing PMI came in at 52.3, also above the expectations of 37.8 in March.
In Japan the Construction Orders registered at 0.7%, topping the forecasts of -0.7% in February, while the Housing Starts came in at -12.3% above the expectations of -14.7% in February. The Annualized Housing Starts increased to 0.871M in February from previous 0.813M.
Meanwhile, the Japanese Foreign Minister Motegi issued travel advice against 73 countries and regions, including, Europe the US, and the UK.
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The Nikkei 225 index finished today 0.88% lower at 18917. The index has lost 20.04% since the beginning of the year, while from the March 20 lows managed to recover almost 18%. The technical outlook for the Nikkei is bearish while the recent consolidation phase helps to digest the rebound and might be the step for another leg higher. A move above the 19,500 mark might cancel the downward trend and attract fresh buying interest.
On the downside, immediate support stands at 18,834 today’s low, if the Nikkei 225 slips below that level, might drive prices down to 18,602 low from March 30. Below that level, the next support will be met at 18459 the low from March 25.
Resistance for Nikkei 225 seen at 19,336 the daily high. The next resistance to the upside stands at 19383 the high from March 27. If the Nikkei breaks higher, the next supply area is at 19560 the high from March 9.