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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. But with so many markets in uncharted territory, it makes it hard for the technical analyst to know just how far a rally might run. Where will the next level of resistance be that results in a significant pull-back? Right now there are still two key markets that are way below their all-time highs. Can we use these to identify likely stalling points for the current stock market bull runs? Let's take a closer look: * NASDAQ 100 (NDX) is sitting near 2030 - well below its all-time high near 4800. * At 18,220 the NI225 (Nikkei 225 Index, Japan) is less than half its record level set almost 18 years ago at 38,957. Beginning with NI225, a quick chart analysis shows the next top is very likely to form in the 19,500 - 21,000 band. It could eventually push higher, but not before a serious pull-back completes. At 23280, it would have retraced 50% of the decline from the 1989 high of 38,957 to the 2003 low of 7604, so this higher level may be a longer-term target, but NI225 should first struggle to break through 21,000. For NDX, the next resistance band is in the 2080 - 2191 range, and if it eventually reclaims 50% of the lost territory it will ultimately push to near 2800 - about 38% above todays level. 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 trend 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 succeed at trading global markets. You can get a unique content version of this article.
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