The Nikkei
index has been in a downtrend lately, being hurt in part by the weak Chinese fundamentals
and a global economic slowdown. Today the index has dropped to the 200 day
exponential moving average, around the round number level of the 19000. The
combination of the 200 day EMA and the round number level may cause this area
to act as a good support and the index may try to bounce to the upside.
However, the fundamentals must help the technical in order to see a change in
direction on the index. If the Nikkei breaks below the 200 day EMA, then the
18668 level may act as its next support. To the upside, the lower line of the
channel at the 19709 level may act as resistance in case we see a bullish
bounce.
Thanks for the analysis.
ReplyDeleteThe reversal of the positive trend in oil in the energy markets has generated new sales in the oil, mining and industrial sectors, whose weakness has spread to the rest of the market.
ReplyDeleteIt will probably bounce off the support.
ReplyDeleteExcellent analysis, thank you.
ReplyDeleteThanks for the analysis, very helpful!
ReplyDeleteGood post.
ReplyDelete