Summary:

• US stock markets have begun their session at record highs
• Asian and European indices have enjoyed strong gains today
• US500, US100 and US30 all breaking higher 

The start of the New Year has been pleasing for equity bulls with US markets already moving above last year’s peak and into uncharted territory. Shortly after the Wall Street open all three major US indices are trading at levels hitherto unseen with the Asian and European indices making strong gains during their cash hours.

The JAP225 reopened for the first time this year overnight with a large bullish gap and wasted little time in rallying above last year’s peak. The market has broken above the upper bound of a rising wedge around 23000 and could now be targeting a swift move up to 24000 and above. 

 The JAP225 has enjoyed a strong break higher today. Source: xStation

Turning our attention to the US and the US500 has gathered momentum in recent trade after clearing the 2700 handle. The market is set for one of the largest weekly gains of recent years at present having added more than 45 points in the last few days. A weekly RSI reading of 84 indicates the market is firmly into overbought territory according to this metric but in the absence of any reversal signals there could well be more upside ahead. 

 The US500 is enjoying one of its strongest weeks in recent years but an RSI reading of 84 could be seen to suggest it is overbought. Source: xStation