Nikkei negative tone persists – FXStreet

By FXStreet Asian regional equity markets closed sharply lower on Monday, with the Nikkei down 3.11% or 502 points, at 16,147.38. Intraday losses were a result of a stronger yen, which added over 500 pips by the end of last week, when Japanese markets were closed on a local holiday.

Having traded as low as 15,852, the index managed to recover some ground as the JPY pared gains this Monday. Volumes around the benchmark will remain low, as it’s the Golden Week in Japan, with the market being opened just Monday and Friday this week.

Nikkei technical view

“Nevertheless, the negative tone persists according to the daily chart, as the index remains well below its moving averages in the daily chart, whilst the Momentum indicator is about to cross its 100 level towards the downside, and the RSI already broke lower, and stands at 42,” said Valeria Bednarik, chief analyst at FXStreet. “In the 4 hours chart, the 20 SMA accelerated its decline above the current level, now at 16,417, whilst the technical indicators stalled their recoveries within bearish territory after correcting extreme oversold readings, also maintaining the risk towards the downside.”

Support levels: 16,037 15,972 17,930 Resistance levels: 16,172 16,247 …read more

Source:: FX Street