Nikkei downside risks prevail – FXStreet

FXStreet (Córdoba) – Asian shares traded lower on Thursday, and the Nikkei 225 closed down 461 points at 17,240.95, following the previous slump in Wall Street. The index fell to its lowest since late September, but recovered in after hours trading, following the sharp comeback staged by US stocks as oil prices bounced.

Poor Japanese data weighed on the index earlier in the day, as core machinery orders fell 14.4% in November compared to the previous month, suggesting that, leaving sentiment aside, the risk is towards the downside.

Nikkei technical perspective

“Technically, and according to the daily chart, the RSI indicator is turning slightly higher within oversold territory, while the Momentum indicator remains flat well below its 100 level. In the same chart, the 20 SMA maintains a strong bearish slope far above the current level, in line with the latest bearish strength”, said Valeria Bednarik, chief analyst at FXStreet. “Shorter term, the 4 hours chart shows that the technical indicators have turned north above their mid-lines, while the index is currently above a horizontal 20 SMA, in line with further intraday advances, particularly on an advance beyond 17,720, this week high”.

Support levels: 17,510 17,430 17,366. Resistance levels: 17,645 17,720 17,800.

Asian shares traded lower on Thursday, and the Nikkei 225 closed down 461 points at 17,240.95, following the previous slump in Wall Street. The index fell to its lowest since late September, but recovered in after hours trading, following the sharp comeback staged by US stocks as oil prices bounced.

(Market News Provided by FXstreet)