NKY closes lower for the 2nd day in a row
Nikkei 225 Index (NKY) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, NKY ended the week -0.59% lower at 23687.59 after losing ¥140.14 (-0.59%) today. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (NKY as at Feb 14, 2020):
Friday's trading range has been ¥134.94 (0.57%), that's below the last trading month's daily average range of ¥192.13. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for NKY.
One bearish candlestick pattern matches today's price action, the Hanging Man.
After trading as low as 23603.48 during the day, the stock index found support at the 50-day moving average at 23630.35. The last time this happened on August 1, 2019, NKY actually lost -2.11% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could accelerate should prices move above the close-by swing high at 23908.85 where further buy stops might get triggered. With prices trading close to this year's high at 24115.95, upside momentum could speed up should the index be able to break out to new highs for the year.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Nikkei 225. Out of 289 times, NKY closed higher 56.06% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 55.36% with an average market move of 0.42%.
With three of the other Major World Indices closing higher and three closing lower today, the winners of the day are HSI surging 0.31% and NDX gaining 0.29%. On the flipside the worst performers have been FTSE closing -0.58% lower and DJIA losing -0.09%. Read more