We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.

Free Trading Guides
EUR/USD
Bearish
GBP/USD
Mixed
USD/JPY
Bearish
Gold
Bearish
Oil - US Crude
Bullish
Bitcoin
Mixed
More View more
Real Time News
  • 🇯🇵 JPY Tertiary Industry Index (MoM) (SEP), Actual: 1.8% Expected: 1.1% Previous: 0.3% https://www.dailyfx.com/economic-calendar#2019-11-14
  • Trade deal bets kept the Singapore Dollar, Philippine Peso, Indonesian Rupiah and Malaysian Ringgit afloat despite $USD strength. This is the key fundamental driver for #ASEAN FX.Get your market update from @ddubrovskyFX here: https://t.co/aB8qP3JsB4 https://t.co/lLPkHZkj4n
  • Heads Up:🇯🇵 JPY Tertiary Industry Index (MoM) (SEP) due at 04:30 GMT (15min), Actual: N/A Expected: 1.1% Previous: 0.4% https://www.dailyfx.com/economic-calendar#2019-11-14
  • Heads up: Japan’s Tertiary Industry Index (MoM) (SEP) is due at 4:30 GMT (15 min) Est: 1.1% Previous: 0.4% #JPY
  • The$USD is attempting a recovery against the Philippine Peso and Malaysian Ringgit. Well-defined resistance levels are still keeping the USD/PHP and USD/MYR downtrend intact.Get your market update from @ddubrovskyFX here:https://t.co/Qb4yAhiaog https://t.co/YOTwULdZ9l
  • Commodities Update: As of 03:00, these are your best and worst performers based on the London trading schedule: Oil - US Crude: 0.59% Silver: 0.15% Gold: 0.03% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/bElqBuMNFc
  • #NOK, #SEK and the #NZD are expected to be the most active G10 currencies vs #USD with 1-week implied volatilities at 8.02, 7.50 and 7.13 respectively
  • If you missed this week's session on what trader positioning has to say about the outlook for $AUDUSD, $USDCAD and $EURUSD, check out the recording on YouTube below. Stay tuned for the full report to come! - https://t.co/caaTDioRiU
  • Forex Update: As of 03:00, these are your best and worst performers based on the London trading schedule: 🇯🇵JPY: 0.09% 🇨🇭CHF: 0.03% 🇪🇺EUR: -0.03% 🇬🇧GBP: -0.06% 🇳🇿NZD: -0.29% 🇦🇺AUD: -0.59% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/tP4kMKk2Pr
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 97.56%, while traders in France 40 are at opposite extremes with 86.29%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/B2ZT4ITYQp
Technical Analysis: Nikkei 225 Looks Comfortable at the Top

Technical Analysis: Nikkei 225 Looks Comfortable at the Top

2017-06-20 03:55:00
David Cottle, Analyst
Share:

Talking Points:

  • Can the Nikkei 225 hold on up here, and maybe even push higher?
  • Well, some of the signs are quite encouraging
  • But watch that possible double top

Make sure your Nikkei 225 trading strategy is up to the mark with the DailyFX trading guide

The Nikkei 225 is around its highs for 2017, indeed it’s higher than it’s been since August 2015.

When an index is doing that, there are only two essential questions ever asked of technical analysis:

Can it stay up here, and if it can’t how bad could the damage be?

Well, to take those questions as they came, the near-term signs are quite encouraging. The Nikkei may be at a rarefied altitude but its moving averages are in the order which often suggests a degree of confidence. The shorter, 20-day remains well above the 100-day and the 50-day crossed back above the 100-day on June 2. That’s usually seen as quite a bullish sign.

Moreover, the index has been happy enough around current levels since about May 1. If there are those who are terrified of these heights, they’re keeping their fears in check quite well. The index looks comfortable in its new, higher range. And, while the Relative Strength Index is unarguably creeping toward territory which might suggest a degree of overbuying, we’re not there quite yet.

Technical Analysis: Nikkei 225 Looks Comfortable at the Top

That’s the good news. The slightly worse news is that the index hasn’t quite yet exorcised the spectre of a double top, which I worried about in my last technical look. Admittedly it has managed to get past the previous peak, June 5’s 20,125. But it has only closed above there once so far on a daily basis. It will need to do more than that to convince investors that a bullish breakout from that possibility is really in play.

As for the second question – how bad would the damage be from any reverse – well, that depends on the nature of that reversal. A classic double top might put all gains made since April on the table. However, a less-dramatic failure of nerve could simply see the index back in the narrow range which has endured since May.

Technical Analysis: Nikkei 225 Looks Comfortable at the Top

--- Written by David Cottle, DailyFX Research

Contact and follow David on Twitter:@DavidCottleFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.