timwest

Nikkei 225 Index JPN225 Has Lagged - Set Up a Bearish Divergence

FX:JPN225   Nikkei 225 index of Japanese listed shares
260 10 6
But Will the Nikkei 225             Play Catch-Up to the S&P500             SPY?
Or is this a massive divergence that presages a sharp decline?
Time will tell!

What do you think?

Tim 2:12PM EST Wednesday, August 27, 2014
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Here's the "Catch Up" example
snapshot
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See the left side of the chart with the black arrow "UP". That's the catch-up example.
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I believe that either they will go up together, or they will correct together. There's nothing there to call a fall in Japanese stocks, and all the JPY pairs look bullish.
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timwest PRO vlad.adrian
It's interesting that one time the Nikkei jumped to catch up to the SPY and the other time the Nikkei fell by about 4% more. Who knows - it is a divergence. I'll add the ratio graph next to look at that.
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The JPN225/SPY ratio chart looks like there is no pattern that I can discern.
snapshot
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imho, the longer term chart, monthly, looks bullish. The daily you are looking here looks choppy, but I wouldn't short it. fwiw...
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JimFred, if you read the headline again, you'll see that I suggest the the Nikkei will play "catch-up" to the S&P, which means I'm looking for it to rally... not decline. I show that they are spread apart and that it would make sense that the Nikkei OUTPERFORMS the SPY from here.
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JimFred JimFred
oops, my bad... sorry...
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Nikkei jumps...
snapshot
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Outperform it did!
Then also sharp correction, then 20% rally...talk about outperforming!
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