JPN 225 Technical Analysis: Consolidation Extends on Downside
- Nikkei 225 Strategy: Bearish trades re-surface
- Mixed signal: downtrend signal resumes while momentum builds on upside
- 10-day MA at 17,445 remains weak resistance. Support is 16,433
The consolidation in JPN 225 took a turn for worse on Friday with heightened volatility on the downside until it stopped short of support level at 16,433. Today has been all about retracement although it remains weak at the topside, capped by 5-day moving average at 17,151.
Upward momentum continues building up while downtrend signal is poised to resume. The consolidation extends lower though followed by sideways movement daily. There is little chance for a full recovery unless a break of 10-day moving average at 17,445 occurs.
The bears could let stops trail 10-day MA or a medium-term resistance level at 17,653. On the downside, support at 16,433 holds for now, which could create dip buying opportunities for small target.
Daily Chart - Created Using FXCM Marketscope
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--- Written by Nathalie Huynh, Strategist for DailyFX.com
Contact and follow Nathalie on Twitter: @nathuynh
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.