The Japan’s 225 stock index (cash) has recently shown signs of a positive upward movement, reclaiming some of the losses it experienced in August. With a soft positive momentum in trading on Thursday, the index reached a three-week high of 38,421. This indicates that there might be more bullish potential in the near future.
Despite the downturn in the stochastic oscillator, other technical indicators are pointing towards a possible uptrend. The RSI is gradually moving upwards, above the neutral mark of 50, and is far from overbought levels. Similarly, the MACD is positively charged and aiming to climb above its zero line. The price action itself has crossed above the middle Bollinger band, showing positive signals.
Challenging Journey Ahead
However, the journey higher for the Japan’s 225 index could face challenges. The 50-day simple moving average at 38,600 and the 39,500-39,950 area might act as resistance levels, teasing the bulls. This could delay any significant advance towards the 41,147-41,500 resistance zone. If the price manages to break through these levels, it will be interesting to see if fresh buying momentum will push it beyond the 42,950 mark.
On the other hand, if the price drops below the 200-day SMA at 37,435, a bearish scenario might unfold. The spotlight will then be on the 20-day SMA (Middle Bollinger band) at 36,600. Further downside could lead to the 35,300 region, and a violation there might push the price back into the 33,585-33,130 floor.
The Japan’s 225 index seems to be maintaining its recovery trend, with the possibility of continuing on an upward trajectory in the near future. However, the challenge lies in surpassing the 38,600-39,950 territory. Whether the bulls will be able to breach these levels and push the index towards higher resistance zones remains to be seen. Investors and traders will need to closely monitor the technical indicators and price action for further insights into the market direction.
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