Nikkei 225 Technical Analysis: Approaching Resistance After Bounce
- Nikkei 225 has bounced off prior support at the 15,000 handle
- Index might be approaching the 16,000 handle for possible resistance
- Further downside conviction may expose the 14,000 handle
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The Nikkei 225 has bounced off prior support at the 15,000 handle following a sharp move lower post the “Brexit” decision, and now seems to be edging higher.
The index recovered from an area of support between the 0.50 Fib at 14,518 (as was drawn for the last monthly leg higher from the June 2012 low at 8,190 to the June 2016 high at 20,961) to the 15,000 handle, and the recovery might imply that the 16,000 handle may be in focus ahead for potential resistance.
A break above the 16,000 handle may expose the 16,500 level that seemed to be influential in the past for deciding short term directional conviction. The level also coincides with a broken channels trend line support turned resistance.
If the latest recovery proves short lived, focus may be put again on aforementioned support zone before further possible levels at the 14,000 and the 13,000 handles.
Nikkei 225 Daily Chart: July 1, 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.