Nikkei 225 Technical Analysis: Ranging Between Short Term Levels
- Nikkei 225 is currently above the 16,500 level
- The 16,776 prior resistance appears to cap gains
- Directional conviction seems lacking at the time of writing
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The Nikkei 225 is trading sideways at the time of writing, and the 16,500 support seems to be influential as price ranges between well-defined levels.
The index closed below 16,500 a week ago, but has since appeared to reject lower prices for a rebound higher. It seems like the price continuous to pivot around the level, which might imply that a clear move away could have an important role defining directional conviction.
With that being said, the Nikkei appears to have found resistance yet again at 16,776, which is the 0.50 Fib as measured from the April 22 high at 17,769.
In turn, these levels confine the index to what looks like a narrow range (on a higher time frame perspective).
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.
If price can close above 16,776, this may expose resistance at the 17,000 handle, with the big range resistance lurking at the top.
If price moves below 16,500, this might put the focus on prior low/support at around 15,800, with interim support at the 16,000 handle.
Nikkei 225 Daily Chart: June 9, 2016
--- Written by Oded Shimoni, Junior Currency Analyst for DailyFX.com
To contact Oded Shimoni, e-mail firstname.lastname@example.org
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.