Nikkei 225 Heading Down to Test 16,000 Level
- Strategy: Watch out for a breach of 16,000 or a bounce from there
- Nikkei index remained largely range-bound
- Although a downside bias dominated price action in near term
The Nikkei 225 broke below a previous support level and came close to the 16,000 mark. It is uncertain whether the index will break through this level, although a downside bias is dominating price action at the present.
In the event of a breach, the support levels below that are at 15,523 and 14,963. Investors who are long the index for long-term or range trades should be cautious with their stop loss around these support levels. The Nikkei remains largely range-bound so a rebound from here is not yet ruled out, particularly if the 16,000 level holds through the next few sessions.
On the topside, a firm resistance level at 17,438.5 is unlikely to be challenged any time soon.
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Daily Chart - Created Using FXCM Marketscope
--- Written by Nathalie Huynh, Strategist for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.