The NIKKEI, Shanghai and HSI finish 2024 relatively strong, while the KOSPI, SENSEX and NIFTY struggle down the stretch.
Major Asian stock indices were a mixed bag closing out 2024. While most finish the year in positive territory, some were stronger than others over the last few months of the year. In Japan, the NIKKEI 225 Index closed December up for the month (+4.41%%) the quarter (+5.21%) and the year (+19.22%).
In China, the Shanghai Composite Index also closed in positive territory across all three time levels: monthly (+0.76%), quarterly (+0.46%), and yearly (+12.67%).
The Shanghai Composite and the NIKEEI are the only indices in this group that closed December with a positive number on all three time levels.
Meanwhile, in Hong Kong, things were mixed. The Hang Seng Index (HSI) finished December up for the month (+3.28%), down for the quarter (-5.08%), but still up for the year (+17.67%).
Looking to India, 2024 was a fairly strong year up until the last quarter. The NSE's Nifty 50 Index closed December down for both the month (-2.02%) and the quarter (-8.39%), but was able to hold on to a positive close for the year (+8.80%). The BSE Sensex Index had a similar outcome across all three time levels: down for the month (-2.08%), down for the quarter (-7.31%), up for the year (+8.17%).
In South Korea, the KOSPI 200 Index finished December down for the month (-2.34%), the quarter (-7.81%), and the year (-11.22%). The only major Asian stock index in this group that closed December with a negative number on all three time levels.
So, let's take a look at the monthly price charts to visualize the big picture performance across Asia. Similar to what you could see in our earlier summary of the European stock markets and the US stock markets, there's a move up coming out of 2022 across most of the major Asian markets, but not as consistently as in the United States or in Europe when zooming out over the big picture. While Japan and India show a more sustained move upwards over the last several years, China has been mixed - Shanghai stayed within a fairly defined range over the past several years while the Hang Seng shows a more obvious downward trend into the later part of 2024 where it saw a bounce. The Energy Model and unique Socrates yellow stochastic line crosses were still helpful in analyzing the momentum, but interestingly there were a few cases where the blue (fast) stochastic demonstrated a notable cross up (China) and down (South Korea) during the later part of 2024.
When studying price charts in the Socrates Platform, pay close attention to the trend lines and oscillators - the Stochastic and Energy Model in particular. When the Energy Model spikes well above its moving average, it indicates a higher risk of losing momentum, which could mean a change in direction may be ahead. In addition, the Socrates Platform includes a unique third stochastic line (yellow) and when it crosses both red (slow) and blue (fast) stochastic lines it can be a helpful indicator, especially if you see alignment with a notable change in the Energy Model.
More generally, the most common approach to studying stochastic indicators is to follow the numerical values: when >80 a market is considered in possible "overbought" condition; when <20 a market is considered in possible "oversold" conditions. Many also look for line crossovers to signal potential alignment of momentum and trend (red crossovers), along with price direction changes (blue crossovers). Keep in mind, the blue (fast) stochastic line is more sensitive to recent price changes, and this can be amplified if you are looking at daily price movement (vs Weekly or Monthly price movement).
Researching markets across different time levels offers a much better view of short-term vs long-term activity. Many follow financial markets on a daily basis, which can certainly be helpful - especially at times of potential market entry or exit - but it's important to keep in mind daily price movement (and indicators based on daily price movement) is most vulnerable to spikes in volatility with reactionary or false price moves. The monthly (and quarterly) time level tends to even out the noise a bit by contrast, providing a cleaner view of actual market trends over the long-term.
Regardless of time level, a change in direction can just be a (relatively) short-term move or brief market correction, it does not necessarily mean it is a true change in the longer term trend. This is why studying market behavior consistently over a period of time, and across multiple time levels (daily, weekly, monthly, etc) is helpful.
Also, while intra-day price movement is worth studying, the Socrates Platform proprietary computer models more heavily weight closing price for each time level as it's a stronger signal of sentiment for that trading period (that day, that week, etc).
Log in to research these and other global financial markets. Go beyond the charts with the Global Market Watch pattern recognition (monthly, quarterly and yearly in particular) along with the Indicating Ranges on a weekly and monthly closing basis. See how - or if - price movement aligns with what different technical indicators and models are picking up on across various time levels (weekly, monthly, etc). This can help shed light on what might be ahead on both a short and long term basis.
Pro and Enterprise members can go deeper in their research with the Reversal System and Timing Arrays, as they look for potential turning points ahead. Keep an eye out for clusters of Reversal points as they represent areas of technical support (Bearish Reversals) and technical resistance (Bullish Reversals). Take note of any relatively large gaps in where Reversal points exist, as it may highlight where a market could see notable price movement before reaching support or resistance.
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