The past week, we’ve seen a significant catch-up by the Nikkei to move back to new ATHs, mirroring earlier moves in the S&P 500 and Nasdaq.
Nikkei 225 on the Daily Timeframe
Zooming out, price is now in uncharted territory, which makes anticipating potential resistance very difficult in the absence of any prior data. However, one way we can battle that is by using the Weekly Average True Range and adding it to this week’s low, giving us an upper target assuming ‘normal’ volatility.
That level specifically comes in at 64,500 JPY, although this will change upon the start of next week.
Nikkei 225 on the 4-hour Chart
Dropping the timeframe lower, we want to try to isolate any support from where a pullback could react. The highest level is located at ¥62,345, where two prior highs now create a smaller support area.
Looking further down, the April ATH at ¥60,930 should attract attention and is expected to provide at least a short-term relief bounce.