nikkei 225 daily outlook thurs 12 nov maintain expected last push up above 19560 support 1753342015

(Click to enlarge chart)

What happened yesterday

 The Japan 225 (proxy for the Nikkei 225) has shaped the expected dip in the overnight U.S. session but held above the lower limit of the short-term ascending channel (in orange) and the short-term pivotal support at 19480.

Please click on this link for a recap on our previous daily outlook/strategy.

Key elements

• Current price action has managed to stage a rebound from the lower limit (support) of the short-term bullish ascending channel (in orange) in place since 02 November 2015 low @11am.
• This short-term ascending channel’s support is resting at around 19560 which also correspond with a Fibonacci cluster.
• The hourly (short-term) Stochastic oscillator has exited from its oversold region and still has room for further upside before reaching its extreme overbought level. This observation suggests that upside momentum remains intact.
• The short-term range top resistance is at 19780 where the Index has been rejected twice in this week follow by the 20050 significant medium-term resistance as per highlighted in our latest weekly outlook/strategy (click here for details).
• Based on the Elliot Wave Principal, the Index is now coming to the tail end of the medium-term bullish impulsive wave structure that has started in 29 September 2015 low. It is now undergoing a potential final bullish wave 5 to complete the larger degree wave 5/ (1) before a multi-week pull-back/consolidation takes place.

Key levels (1 to 3 days)

Pivot (key support): 19560

Resistance: 19780 & 20000/20050

Next support: 19150

Conclusion

Short-term technical elements remain positive, thus we are maintaining our expected “last push up” scenario above the adjusted daily (short-term) pivotal support at 19560 for the Index to retest the short-term range top at 19780 before targeting the 20000/20050  significant medium-term resistance.

However, failure to hold above the 19560 pivotal support may invalidate the bullish tone to see the start of a multi-week pull-back scenario for a slide to test the next support at 19150 in the first step.

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