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16 Dec 2013
Nikkei 225 testing bottomside of 2-week contraction wave
FXstreet.com (Bali) - The Nikkei 225 continues to be pressured during the morning trade in Tokyo, now trying to break a contraction wave formed since the index topped out just shy of 16,000 (15,800) in early Dec. We are presently around 15,300.
Technically, on the back of an almost uninterrupted 17-day bull run away from a multi-month triangle formation, the index has been, so far, unable to break through a long-term descending trendline (zoom out Nikkei 225 chart 10+ years to be spotted), leading to prices compressing in a triangle (length 2 weeks now), with the downside dynamic support being tested.
While a break to the downside may expose another leg lower towards 15,000/15,050, if the pattern holds, further maturity with buyer seeking higher ground is expected, all within context of choppy price action as volume thins out towards year-end. As a consequence of current price action, it is probable that Yen cross display erratic trading conditions.
Technically, on the back of an almost uninterrupted 17-day bull run away from a multi-month triangle formation, the index has been, so far, unable to break through a long-term descending trendline (zoom out Nikkei 225 chart 10+ years to be spotted), leading to prices compressing in a triangle (length 2 weeks now), with the downside dynamic support being tested.
While a break to the downside may expose another leg lower towards 15,000/15,050, if the pattern holds, further maturity with buyer seeking higher ground is expected, all within context of choppy price action as volume thins out towards year-end. As a consequence of current price action, it is probable that Yen cross display erratic trading conditions.