The market saw a dip toward the end of trading activities this week. However, tech stocks provided some support, aiding a recovery in the Japan 225 market. Currently, the market has formed a base that may support further price increases in the new week. Let’s take a closer look below.
Key Levels
Resistance: 51,000, 52,000, 53,000
Support: 49,000, 48,000, 46,000
Japan 225 Is Headed for Higher Ground
With the NIKKEI 225 posting gains for the second consecutive session, price action appears poised for further upside. The most recent price candle has moved above the 9-day Exponential Moving Average EMA. It remains green and moderately sized.
Meanwhile, the Stochastic Relative Strength Index SRSI indicator lines are rising after a bullish crossover from the oversold region. These signals align and suggest that an upward retracement may continue.
NIKKEI Hits a Brick Wall Below 50,500
Although bullish momentum fueled a notable recovery, signs suggest that the upside momentum may be weakening. The most recent price candle indicates that price action was rejected near the 50,540 resistance level. Nevertheless, the candle remains above the 9-day EMA.
Additionally, the SRSI indicator lines have started to decline following a downward crossover from the overbought region. While some traders may consider short positions at this stage, the current price remains at a comfortable distance above the 9-day EMA. This suggests a potential cushion, and a rebound may occur near the 50,000 price level.
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