10th August - Japan's Currency and Stock
10 August 2015
TECHNICALS:
Nikkei continuation index future chart (monthly)
Apart from the Oil and Gold charts, trading ranges have dominated this summer.
The exception is Japan where big trends and patterns remain in place or have completed.
In the Nikkei for example, there’s a large Double Bottom in the monthly chart, driven by continuation Triangles, looking set to drive the market a good deal higher...
This contrasts with the wide trading ranges in the other major markets
Dollar Yen Weekly chart
The Yen has a clear and well-constructed trend well in place – note how the market finds powerful support from Prior Highs, ratcheting it better.
iShares Dollar hedged Japan MSCI index ETF
The result of both the strength of Japanese stocks and the dependable weakness of the Yen is that interesting chart structures have arisen when the weakness of the Yen is hedged out.
Here, the Yen/Dollar Hedged iShares ETF has completed a bull continuation Head and Shoulders pattern.
(Though the additional comfort of a break up through the Prior High at 34.5 might be required by more cautious bulls.)
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