Nikkei 225 (13953)
In the last review (16th April) when the Nikkei was trading at 12990, I was stated “after a 15% rise since the recent bottom of 11691, the Nikkei is in a consolidation zone; once the recent high of 13485 surpassed we may expect a continuation of the bullish trend; stop is placed at 12430 for the longs”.
As expected, after a brief consolidation, the Nikkei had rose to 4 months high at 14208 (7th May), gaining over 21% since March low. The stop of 12430 remains untouched.
In the last week the Index has lost 4% from the week’s high of 14208, but recovered smartly in the previous 2 trading sessions, from the low of 13540. However, this recovery may turn out to be a short lived if the trend doesn’t sustain above 14050.
If it does, then expect a continuation of the uptrend towards a target area of 14220 - 14390, else the Index may fall into a sideways trading zone of 13620-14050 for the next couple of trading sessions, before deciding future course of action. Revise stop from 12430 to 13620.
