Japan's Nikkei 225 Is on the brink of a massive upside move!

FX:JPN225   Nikkei 225 index of Japanese listed shares
1338 17 26
Japan's Nikkei 225             Index - Daily

Is poised to blast out of major resistance just overhead at 18400-18500. If it can successfully hold on to a blast-off move over 18400+, we can look for gains to 20,000+ and then 21,600+ over the coming 8-16 weeks. I am waiting for 18,400 to break first, then buy half the position. I'll buy another half crossing 18,500 and use a stop as close as 18,250 initially. It may take a few more times to push through but when it does it will be fast and furious. I will look for daily ranges to expand on the upside to buy even more.

NOW YOU SEE WHY THE MARKET HAS BEEN CAPPED AT THIS LEVEL = OLD RESISTANCE AREA from aggressive selling campaigns in August and September denoted by the RED TRIANGLES. The market has re-tested these levels several times and is chipping through this overhead supply. Once it gets through, then we get long and get aggressively long.

RISK Management: (I'd risk a normal position size here at 1% of the portfolio, so that if it hits the stop on a the full position entry (18,450 entry, 18,250 stop) I would lose 1% of my overall portfolio.

Tim Sunday, October 18, 2015 11:39PM EST

"Key Hidden Levels Chat Room" here at TradingView
Comment: Japan looks ready to blast off again from this sideways range around the $19000 level which should propel us up to 20,000 and beyond.
Trade closed manually: I believe this is a great spot to get off of this train. 19600. Right here. The rally just doesn't look right. There is something that doesn't look right. The ranges aren't explosive to the upside and it is running into old resistance from the very sharp, strong sell-off in August. I believe this price zone spells trouble and it is wise to walk away from any long positions here. The risk is high now because stops are so much lower and there doesn't appear to be much more upside. If anything, go short here and use a stop up just 200 points. I think the market has pushed itself up too high, too fast here.
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i know you don follow pattern, Tim
but sounds like IHS for me
timwest PRO jangseohee
I do follow H&S @jangseohee - I've published them many times
+1 Reply
jangseohee timwest
Thanks Tim. How are you able to see 'aggressive selling shown by the red triangles'? What are you looking at for this info?
IvanLabrie PRO BuySellBuySell
I'll reply since Tim has been busy probably.
The triangles simbolize the resistance level created by strong selling. Tim calls these bars as range expansion bars, and they are larger than the sum of the previous bar's true range to its close (or go lower than the difference of the close and true range).
The 50% retracement level from open to high or low to open is a strong resistance or support and can be a good guide to navigate the markets.
BuySellBuySell IvanLabrie
Many thanks Ivan. Much appreciated.
+1 Reply
Great analysts tim. This is really helpful as it falls in line with what I have seen. I personally will be looking on the 4hr timeframe as last week we had a triple top there. And have since worked it off. And if it touches a 4th time like you said it will take off. All though I don't believe it will last 16 weeks as we are headed for a bigger correction from December we are show big divergance on the monthlys so I will be watching the top and new highs closely along with the volume.
This lines up with the downtrend expiring that I had in my Nikkei chart, and also the Asian currencies showing signs of a strong uptrend (AUDUSD, NZDUSD, AUDJPY, NZDJPY, etc.)
Agreed. Triangle breakout is always followed by massive move in Nikkei. However we might need some fundamental catalyst for that move.
Hi Tim. Just wondering: you are seeing the Nikkei with potential for a big rise and in another post you are looking the the S&P500 making a decline and you took short position. Is this not a contradiction as there is usually a decent correlation between these two indecies?
Victor.Y.F PRO BuySellBuySell
Sorry to interrupt, but I think it's because JPY and XAU isn't much correlated as before. JPY weak could be XAU strong now.
timwest PRO BuySellBuySell
The Breakout pattern in the Nikkei certainly made me hesitant on the SP500 forecast. It's great when I can get both correct, but the blend of the two trades is still profitable. The S&P500 hit the stop and the Nikkei is still going up. We are in the middle of earnings reporting season and a few big name stocks have lifted the market together with plenty of central bank jawboning to get equity markets up and "risk-ON" mentality going again. The markets are heavy, just like the economies around the world. Softness abounds. Central banks are driving prices here. Stay tuned. (Sorry I missed your question - I didn't see it come in - Private Message me If I don't reply in a day - that goes for anyone) Tim
+3 Reply
Interesting. Thanks Tim.
ACTIV8X timwest
I agree with you that earnings are going to play a major role in boosting the prices stocks and may even go to inflating them...All the ingredients are here for a rally...
This rally looks ugly now, there should be a retrace. Harmonic patterns are everywhere now.
A bit confused with "The ranges aren't explosive " and "I think the market has pushed itself up too high, too fast here." - arent these contradictory

78.6 can be the target? as we have good supply area there?
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