Nikkei Analysis July 2015 (D,W)
Created on Sunday, 28 June 2015 01:21
Written by Austin Galt
The Nikkei is the stock market I am most bearish about and it looks to be the last one that I cover to put in its final high. That looks imminent so let’s revise the technicals using the daily and weekly charts.
NIKKEI DAILY CHART
Price has been inching higher the last few months as it bounces up and down between the lower and upper Bollinger Bands. I favour one last at the upper band to put in the final high.
The PSAR indicator has a bullish bias so the coast is clear there.
One final high looks set to be accompanied by a triple bearish divergence on the RSI while the MACD indicator also has multiple bearish divergences in place. Its averages have diverged so the move higher in price may well be coming to an end.
I expect a final high is close at hand after which a big downtrend should ensue.
NIKKEI WEEKLY CHART
The expected final high looks set to throw up a triple bearish divergence as well on this weekly chart.
The PSAR indicator continues to provide support to the recent uptrend with the dots once again holding the recent move down by price.
The rise in price this year looks parabolic in nature which is commonly found at the end of bull markets.
I have drawn a Fibonacci Fan from the start of the parabolic move and we can see price has generally been trading between the 50% and 61.8% angles. The latter angle finally looks to be starting to give way and once the final high is in place shortly then I expect a big downtrend that cracks this angle once and for all.
Once the final high is place we can review targets for final low.