Tokyo’s Nikkei stock index suffered the biggest fall since June 2013, as the stronger yen hurts Japanese automakers such as Toyota, Nissan and Mazda. The Japanese Yen itself rose to the its highest level against the dollar since November 2014. It seems the Bank of Japan at this moment is losing its ability to weaken the currency through monetary easing, since the BoJ announced negative interest rate for the first time on 29 January, the Yen still gained 3 percent against the dollar, while the Nikkei index has slumped 15 percent over 2016.
Technical Analysis:
Intraday Preference: BEARISH
Reference Area: 16578-16772
Nikkei remains under heavy pressure, hits the level of 15820 which serves as intraday key support. If the support breaks, Nikkei might continue to fall to 15476-15188.
Note that hourly stochastic has crossed up and CCI is oversold. As alternative strategy, watch for bearish signal confirmation on a pull-back move to within the reference area at 16303-16602 with potential target at 16119-15820.
Be careful if the resistance at 16602 breaks, because it will turn the intraday bias to bullish and possibly will be followed by a bullish move up to 16814-17085.
By Andrew Bulan, analyst for http://www.EconomicCalendar.com
