Nikkei 225 (N225) Moving averages remain down

The major Japanese stock index has been grabbing 2.2% since the beginning of the year. Japan therefore remains attractive due to its defensive nature and the safe haven status of its currency in highly volatile configurations. The country’s relatively stable political context also adds to its attractiveness. Moreover, monetary policy remains accommodative.

The winners at the beginning of this exercise are Olympus (equipment) with 34% and the chemist Tokai (+22%). Rakuten, the specialist in Internet shopping, is progressing in line with the +15% rebound in technology stocks.

On the other hand, some brands in the consumer sector, such as Fast Retailing (clothing) or Shiseido (beauty products), have closed the gap in the performance ranking since the beginning of the year, with declines of 11% each.
 

Technically, in daily data, the Nikkei 225 rebounds from the lower part of the 19,150 points. This dynamic recovery is counteracting the negative medium-term background movement (downward moving averages). Therefore, the 21,120-point resistance approach, in pullback mode, could slow the rate of progress. This 21,120-point line would have to be exceeded to hope for an extension towards 23,000 points. On the other hand, a blockage on current prices would encourage the selling current to take back control, to aim again for 19150 points.