Today we will talk about Japanese Index NIKKEI 225 in which we see very clear bullish pattern.
As you can see, NIKKEI made an A-B-C corrective decline from the highs and the main reason why we think it's a correction within uptrend is because of a triangle within wave B in the middle. We know that triangles cannot occur in wave 2, so it must be wave B as part of an A-B-C correction.
The Next very important evidence that A-B-C correction is completed is recent five waves up from the lows and we know that a five-wave reversal indicates a change in trend, so NIKKEI will probably stay in the uptrend.
However, in EW theory, after every five waves, a three-wave pullback follows, so before we will see a continuation higher, be aware of a corrective slow down with ideal support in the 28800 - 28300 zone. Of course, pullbacks could be even deeper, so count remains valid as long as the price is trading above 27400 May lows.
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