Nikkei Hunting

20 Nov 2023

This is a project that tries to catch pivot points and reversals using Japanese Candlesticks Analysis. All rectangles are zones of influence where support/resistance forces might occur. Icons are milestones with relevant time stamps in the multiple simulated scenarios that might unfold. Although the elements are pointing into a downward channel, there is also the scenario where after a longer correction the market might push for higher highs, leaving the big ellipse as a potential consolidation zone in case this type of scenario unfolds. Marked price levels are also to be considered when hunting for potential pivot points (entry signals) regardless of the nature of the Candlestick Signal relative to the recent wave direction, form, and length. A pivot point can turn out to be a complete reversal of the wave, or just a swing in a wave where smaller corrections or consolidations occur.

The project does not try to anticipate the overall tendencies of the future evolution of the price, but rather cast a "web" of elements that provides a predetermined overall context, in the attempt to hunt for potential entry signals.

We start this project with a potential bearish engulfing which qualifies as a potential signal, but doesn't look at first sight as a complete reversal. This status might change, but in the incipient analysis of the candlesticks involved, we can observe the nature of the candlestick shadows with their highs, signaling a weakness in the bullish momentum.

30 Nov 2023

Nota

Small update with some candlestick analysis. The high of the initial candlestick potential signal was not breached. A formation of candlestick shadow lows has been formed on the down move which is an indication of a potential pivot point. Decent green candle for today which could be the beginning of a bull move that can last several days, but I might pass on this signal, regardless of potential results. The white rectangle looks more likely to be hit than the red one.

5 Dis 2023

Nota

Bounce from the marked price level leaving a candlestick shadow behind. A bullish engulfing tomorrow could be the start of a small attempt to push for higher prices near the white rectangle.

8 Dis 2023

Nota

The market kind of went for the price level of the lower edge of the white rectangle, but bounced really hard and really fast with no goodbyes and no "I am sorry", because the candlestick shadow left behind was a clear sign of "something is up". Or down. Speaking of down and candlestick shadows, here we are with 2 of them in the red rectangle zone, a setup which according to nen standards would qualify as a potential entry signal. Unfortunately this still doesn't present itself like an ideal setup. If this eventually turns out to be a significant pivot point, there should still be some retracement happening on Monday, creating a specific low for the daily candle, maybe 140 pips below the current price.

There is the scenario in which the next trading days might turn out to be a consolidation period with no volatility and big swings. With this in mind, maybe it would be best advised to sit this one out. Any missed opportunity also represents money not being risked at all.

15 Dis 2023

Nota

After a failed counteroffensive of the bulls, starting from the red rectangle, bears made the nikkei slide towards the blue marked price level where further resistance has been met, leaving a candlestick shadow at the top edge of the rectangle. Unfortunately I do not see a decisive winner in the foreseeable future. This might keep consolidating for a while before it pops and turns again.

19 Dis 2023

Nota

Bull rally

27 Dis 2023

Nota

3 candlestick shadows at around the same level (orange dot in the snapshot). Bulls might be running out of steam in Japan.

29 Dis 2023

Nota

Confirmation of the bullish weakness with a 400 points drop.

4 Jan

Nota

Rebound from the marked price level 32678

10 Jan

Nota

It would be interesting to see the price action at this ellipse which could trigger a corrective mood as initially mentioned in the idea with the consolidation scenario.

11 Jan

Nota

Candlestick shadow next to the rectangle but outside so it doesn't actually count. I might be wrong but this project might be over unless we see some bumps at the nearest blue level or back at the ellipse.

16 Jan

Nota

Not a super setup with this bearish candle, but after such a bull run and probable decrease of volume in the last 2 bullish candles, this could be an inflection point with greater activity as shown by Bill Williams MFI indicator.