Talking Points:
- Index higher after moving above 16,500
- Focus may turn to 17,000 for possible resistance ahead
- Break above 17,000 might expose 2016 highs below the 18,000 handle
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The Nikkei 225 is trading higher, for the fifth consecutive day, after the index moved above the 16,500 level.
The price has been ranging between the well-defined 18,000 resistance zone and the 15,000 support since the start of the year, with gains appearing to be corrective in the context of the near term down trend from June 2015 highs.
The index found support at the 16,000 level following what now appears like a short term corrective move lower from around 17,000 and that level might now be back in focus for possible resistance. The 200-day SMA is also in proximity, which could imply that a break above 17,000 may be significant and expose the range highs slightly below the 18,000 level.
With that said, if the price fails at the 17,000 level or moves below 16,500, this may have eyes on the 16,000 handle for potential support, and a break lower could expose the 15,000 range lows once again.
Nikkei 225 Daily Chart: August 10, 2016
--- Written by Oded Shimoni, Junior Currency Analyst for DailyFX.com
To contact Oded Shimoni, e-mail oshimoni@dailyfx.com
Follow him on Twitter at @OdedShimoni
