The recent decline in the Nikkei 225 index follows a rally that was initially sparked by the recent election results in Japan.
The index is now revisiting critical support levels, including the 200-day simple moving average and the 55-day simple moving average.
However, the index remains supported by a tentative uptrend line established between August and October, as well as last week's low.
These levels are crucial for maintaining the medium-term uptrend.
In the UK, the FTSE 100 has faced significant challenges and has fallen through critical support levels following the recent UK budget announcement.
The index is now approaching the next potential support level, with the psychological barrier of 8,000 looming just below.
The NASDAQ 100 has also encountered turbulence and has formed a bearish engulfing pattern on its daily candlestick chart.
The index's recent performance has been affected by rising US Treasury yields and mixed corporate earnings reports.
Key downside targets for the NASDAQ 100 include the August-to-October uptrend line and last week's low.
The recent movements in these major indices reflect broader market sentiment, which has been influenced by political developments and economic indicators.
The loss of parliamentary majority in Japan, the UK's budget announcement, and mixed corporate earnings in the US have all contributed to the cautious outlook.
The interplay between economic data and political events will be critical in shaping future trends, and investors are advised to remain vigilant in the face of volatility.
Strategic positioning and risk management are important in navigating these uncertain waters.