Talking Points:
- Sizable breakout looks imminent
- Range of triangle points to 1500 point move
- Direction yet determined, break of either key trend-lines will be confirmation
The price of the Nikkei (JPN225) has been contracting for several weeks now. This action is leading to a well-defined triangle formation with a high likelihood of breaking out next week. Which way will it break? Your guess is as good as mine, which is why it wise to wait for a confirmed breakout above or below the converging trend-lines. Given the height of the pattern, the measured move to expect after a breakout is roughly 1500 points.
JPN225 4-hr: Oct’14 – Jan‘15
--- Written by Paul Robinson
To contact Paul, email him at instructor@dailyfx.com
