Rise with the Land of the Rising Sun

• Posted by Greg Harmon
• on September 11th, 2013

Revisiting the currency wars, it seems that the Japanese market has settled out a bit. The Nikkei ($NKY) is consolidating around the 61.8% Fibonacci retracement of the move lower from 2007, building a symmetrical triangle on the weekly chart below. The triangle is now getting tight and with the Relative Strength Index (RSI) continuing to hold the mid line on each pullback, it makes sense to prepare for a possible break out higher as to approaches the top of the triangle this week. A Measured Move higher takes the Index to 19250, a stone’s throw from a full retracement of the down move. That would

have the Nikkei finally joining the rest of the world’s major market indexes in fully retracing the move from the financial crisis. Look for a break over 14500 as a trigger. Oh, so you don’t have an account in Japan? No problem. There is a Japan iShare ETF ($EWJ) shown below that is in the same pattern. The trigger there is 11.80 with a target on a Measured Move to 13.80 to start.

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