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25 Apr 2016
Nikkei lacks directional momentum in the short-term - FXStreet
Asian share markets closed mostly lower, with the Nikkei 225 down 132 points or 0.76% to end at 17,439.30. Investors preferred to take some profits out ahead of the upcoming Fed and BoJ's meetings later this week, whilst mixed earnings reports fueled the cautious mood.
Among the worst performers was Sony, down 6% after the company reported it would delay its earnings forecast for the 2016 fiscal year in order to assess the impact of recent earthquakes on its profits, whilst exporter-related shares edged mostly higher amid a weaker JPY.
Nikkei technical viewpoint
“From a technical point of view, the daily chart shows that the Momentum indicator maintains its upward slope, despite being in extreme overbought territory, although the RSI indicator is partially retreating, also from overbought levels. The 100 DMA stands at 17,183, a strong dynamic support in the case of further declines,” said Valeria Bednarik, chief analyst at FXStreet. “In the 4 hours chart, the index is struggling around a bullish 20 SMA, whilst the technical indicators have lost downward strength within positive territory, after reaching their mid-lines, where they turned flat, rather reflecting the absence of directional momentum at the time being than supporting a certain directional move.”
Support levels: 17,332 17,212 17,161. Resistance levels: 17,507 17,587 17,692.
Among the worst performers was Sony, down 6% after the company reported it would delay its earnings forecast for the 2016 fiscal year in order to assess the impact of recent earthquakes on its profits, whilst exporter-related shares edged mostly higher amid a weaker JPY.
Nikkei technical viewpoint
“From a technical point of view, the daily chart shows that the Momentum indicator maintains its upward slope, despite being in extreme overbought territory, although the RSI indicator is partially retreating, also from overbought levels. The 100 DMA stands at 17,183, a strong dynamic support in the case of further declines,” said Valeria Bednarik, chief analyst at FXStreet. “In the 4 hours chart, the index is struggling around a bullish 20 SMA, whilst the technical indicators have lost downward strength within positive territory, after reaching their mid-lines, where they turned flat, rather reflecting the absence of directional momentum at the time being than supporting a certain directional move.”
Support levels: 17,332 17,212 17,161. Resistance levels: 17,507 17,587 17,692.