nikkei 225 potential short term corrective rebound in progress 2691042017

Short-term Technical Outlook (Tues, 18 Apr 2017)

(Click to enlarge chart)

What happened earlier/yesterday

The Japan 225 Index (proxy for the Nikkei 225 futures) had staged the expected corrective rebound right above 18200 reinforced by a similar rebound seen on the USD/JPY at the 108.40/108.00 medium-term support as highlighted earlier after the “final drop”. Please click here for a recap on our latest weekly technical outlook report published earlier yesterday, 17 April.

Key technical elements

• The key short-term support now rests at 18295 which is defined by the minor swing low area of 17 April 2017 and the 76.4% Fibonacci retracement of the first leg of the corrective rebound in place since yesterday low to today (18 Apr) Asian session current intraday high of 18545.
• The significant short-term resistance stands at the 18580/640 zone which is defined the upper boundary of the minor descending channel in place since 29 March 2017 high and former range support from 17 January/06 April 2017
• The short-term hourly Stochastic oscillator is now coming close to an extreme oversold level where another round of potential short-term upside movement may materialises at this juncture.

Key levels (1 to 3 days)

Pivot (key support): 18295

Resistance: 18580/640

Next support: 18060

Conclusion

As long as the 18295 short-term pivotal support holds, the Index may see another round of corrective rebound to target the 18580/640 resistance.

However, a violation of the 18295 level is likely to invalidate the preferred corrective rebound to see the continuation of the medium-term downside movement to target the next support at 18060 in the first step.

Charts are from City Index Advantage TraderPro & eSignal

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