Global stock markets are retracing after maintaining a bullish momentum. The Nikkei has dropped quite suddenly due to a slump in oil prices.  The Nikkei dropped nearly -0.45% to trade at $20,138.79 today.

The bearish momentum in the Japanese stock markets is being caused by falling oil prices. Oil prices have a direct impact on US equities – a drop in oil prices drags the US stock indices. Due to the strong positive correlation between Nikkei & DJIA, we have encountered a dip in the Nikkei today.

Let's have a look at the major trading levels for this week. Also, here is a very useful article on trading support and resistance levels.  

Nikkei – Weekly Trading Levels

Support                   Resistance

S1: 20119.17            R1: 20262.41

S2: 19975.91            R2: 20350.91

S3: 19887.42            R3: 20494.16

For now, investors are recommended to focus on the US economic events, specifically, the EIA Crude crude oil inventories and US Existing Home Sales. These events have the potential to impact US equities and eventually the Nikkei.