Never miss a story from Oded Shimoni

Subscribe to recieve updates on publications
Please enter valid First Name
Please fill out this field.
Please enter valid Last Name
Please fill out this field.
Please enter valid email
Please fill out this field.
Please select a country

I’d like to receive information from DailyFX and IG about trading opportunities and their products and services via email.

Please fill out this field.

Your Forecast Is Headed to Your Inbox

But don't just read our analysis - put it to the rest. Your forecast comes with a free demo account from our provider, IG, so you can try out trading with zero risk.

Your demo is preloaded with £10,000 virtual funds, which you can use to trade over 10,000 live global markets.

We'll email you login details shortly.

Learn More about Your Demo

You are subscribed to Oded Shimoni

You can manage your subscriptions by following the link in the footer of each email you will receive

An error occurred submitting your form.
Please try again later.

Talking Points:

- 16,500 held as support with a bullish short term technical sign

- Index now trading near potential resistance after four days of gains

- A break above 17,000 could prove key going forward

Learn good trading habits with the “Traits of successful traders”.

The Nikkei 225 is trading higher for the fourth consecutive day, alongside declining Yen prices, after the index formed a bullish “Hammer” formation on the 16,500 support.

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

The move to the upside has seen the index trade to a resistance area below 17,000; a confluence resistance zone with the 17,000 handle, 200-day SMA and the last swing highs.

At this stage, a break and a hold above 17,000 seems key for further upside gains, potentially exposing the longer term range top.

If the index reverses from this zone, focus might shift to 16,500 again for support, anda break lower could put the spotlight on the 16,000 level.

Volatility continues to become even more subdued, with 20-day ATR volatility measures now indicating the lowest levels since late 2014.

Nikkei 225 Daily Chart (With USD/JPY overlay): August 31, 2016

Nikkei 225 Technical Analysis: Index Approaching Key Resistance

--- Written by Oded Shimoni, Junior Currency Analyst for DailyFX.com

To contact Oded Shimoni, e-mail oshimoni@dailyfx.com

Follow him on Twitter at @OdedShimoni