FxWirePro: Nikkei225 forms bearish divergence, good to sell on rallies
Nikkei has shown a minor sell off after hitting a high of 20228 on Jun 5th 2017 on account of Fed monetary policy meeting which is to be concluded tomorrow. It is currently trading around 19923. Fed is expected to raise …
Nikkei has shown a minor sell off after hitting a high of 20228 on Jun 5th 2017 on account of Fed monetary policy meeting which is to be concluded tomorrow. It is currently trading around 19923.
Fed is expected to raise its federal funds target to between 1% and 1.25% from 0.75% and 1% after the conclusion of two day meeting on Wednesday. Investors will pay close attention to the press conference for the clues of reduction in $4.5 trillion balance sheet.
On the lower side, near term support is around 19750 (Kijun-sen) and any break below will drag the index down till 19450 (38.2% retracement of 18189 and 20228)/19358 (89- EMA).
The near term resistance of Nikkei is around 20000 and break above will take the index to recent high of 20228/20477 (161.8% retracement of 20019 and 19277).
In the daily chart the index has formed bearish divergence in RSI and MACD. So a small dip till 19350 is likely.
It is good to sell on rallies around 19950-20000 with SL around 20220 for the TP of 19360.
