JPN 225 Technical Analysis: Correction Continues within Range
- Nikkei 225 Strategy: Range trade / short-term trade during the correction
- Friday’s low at 16,568 provides weak support level. Resistance is 10-day MA at 17,304
- The correction may extend up to 17,653 resistance
JPN 225 recovered modestly, heading toward 5-day moving average at 17,071 and topped by 10-day MA at 17,304. Range trade and short-term speculations dominate amid mixed price action. This correction period will likely be contained between support at 16,433 and resistance at 17,653.
Upward momentum is waning although any downside extensions will likely skip Friday’s low of 16,568. Heightened volatility after China GDP and prior to Japan PMI report may complicate the picture, as the index is on a typical rebound after Friday’s crash.
Downtrend signal has not finished therefore investors should stay cautious of resistance levels at top.
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