Talking Points:
- Nikkei 225 Strategy: Watch support during this correction period
- Immediate support is 76.4% Fibonacci at 15,545, then 14,963
- Momentum reversal dampens topside bias, although resumption may follow
JPN 225 is trading sideways after the previous sharp rise lost momentum. There is not yet any indication of a directional move, hence 76.4% Fibonacci and support level should be relatively safe while the index is stuck.
Traders with long positioning may keep their stops tight and close to support level in case the downward momentum strengthens. It is too early to gauge if the rebound has finished, or this is simply a temporary correction.
Those looking to buy dips may find opportunities to enter trade provided the 2 support levels are not threatened throughout this week.
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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
