Nikkei 225 slips lower as trade tensions erase bulls' momentum

• The Nikkei is declining as trade fears sap buying potential out of the broader markets.
• Risk appetite is withdrawn and traders have decided to play it cool with their money.

The Nikkei 225 index is declining in Wednesday trading, reaching a low of 21,230.00 before bouncing with little enthusiasm back to 21,285.00.

Risk sentiment is squarely in the driver's seat in the Asia session, and equities are withdrawing in the face of a new round of tariffs in the ongoing US-China runup to a potential trade war between the two countries. 

Traders in Asia haven't outright fled for the doors, as many are still hopeful that historical precedent will take hold and trade negotiations will bring about a peaceful resolution to the current trade tensions, but a lack of bidding has seen the Nikkei sink steadily from a session high of 21,455.00.

Nikkei Levels to watch

The Nikkei index has been stuck to the 200-day SMA more often than not for 2018, and Daily candles could be pricing in another drop from this region if buyers aren't able to step in and propel the index above the declining trendline, providing resistance from the 34-day EMA at 21,550.00 with further resistance at the current swing high of 21,630.00, while a bearish correction will see the Nikkei running into support from yesterday's low at 21,040.00 and the last swing low at 20,925.00.