Nikkei poised to extend advance - FXStreet

Asian shares edged lower, tracking the previous decline in Wall Street, with the Nikkei 225 shedding 139 points or 0.84%, to end at 16,642.20. The Japanese benchmark extended its decline to a fresh weekly low of 16,480, but later bounced alongside with oil back trading near its yearly highs.

Despite increasing downward risk in the Chinese economy, risk sentiment improved during London trading hours, and good mood among investors prevailed.

Nikkei technical view

“From a technical point of view, the index seems poised to continue advancing this Thursday, as in the daily chart, it remains well above a bullish 20 SMA, whilst the technical indicators have resumed their advances within bullish territory, after erasing previous overbought conditions,” said Valeria Bednarik, chief analyst at FXStreet. “In the 4 hours chart, however, the upside looks limited, as the index is unable to extend above its 20 SMA while the technical indicators are being rejected by their mid-lines. Some additional advances beyond 16,812, the immediate resistance, is required to draw a more constructive intraday outlook.”

Support levels: 16,640 16,557 16,482. Resistance levels: 16,812 16,897 16,967.