Intraday Preference: BEARISH
Reference Area: 16316-16504
Comments:
Japanese stocks, the Nikkei 225, continued their weakness in the beginning of the week on Monday (04/04/2016), the strengthening of the yen still provided the load against the movement of the Nikkei.Throughout last week, the Nikkei 225 fell as a result of varied Japan’s economic data, as well as the yen continued to strengthen against the dollar.
The latest data released Friday, shows the level of confidence in Japanese manufacturers worsened in the first quarter of this year. Data released by the Bank of Japan (BoJ) showed major Japanese manufacturing company sentiment fell to 6 in the period from January to March, compared with the previous quarter by 12.
Technical Analysis:
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20 MA and 50 MA are still falling on hourly chart and Nikkei is moving below the MA, testing the intraday key support area at 16010. If the support breaks, Nikkei possibly will keep falling to 15792-15610.
Hourly stochastic and CCI are oversold. As alternative strategy, watch for bearish signal confirmation on a pull-back move to within the reference area at 16316-16504 with target at 16199-16010.
Be careful if the resistance at 16504 breaks, because it possibly will turn the intraday bias to bullish and potentially will be followed by a bullish move up to 16639-16810.
By Andrew Bulan, analyst for EconomicCalendar.com
