The Nikkei 225 Index Futures (CME: NIY) are enjoying a bullish Thursday trading session after adding over 0.4% gains to the Wednesday session’s strong 2.21% gains as the lack of economic indicators from the economy left the increased appetite for riskier assets to dictate the index futures higher.
The index futures recently broke through a 33-year high after rising over 19% year-to-date as the Japanese stocks continue to outperform their global peers. The bullish sentiment from the strengthening USDJPY currency pair outweighed the dent from the disappointing trade data from Japan as the market looks to continue to climb to new heights.
The 4H chart shows that the index futures recently broke out of the bullish ascending channel to reclaim a 33-year high. With the RSI having entered the overbought territory, a possibility exist for a pullback and retest of the upper trendline of the channel and the daily pivot point at 30310. However, should the bullish sentiment persists, the bulls could look to claim the resistance level at 30950 (R2) if they look to test the next resistance level at 31435 (R3).
However, should the upper trendline fail to hold, a potential for a bears’ run towards the support level at 29834 exists. The fall of the 29834 price level would bring the 29360 support level and the lower trendline of the channel into play.
With the index futures bullish, breaking new highs, a potential for a pullback towards the lower significant levels exists in the near term. However, should the bullish momentum continue during intraday trading, a short-term opportunity could exist as the bulls dismantle the 30985 resistance level towards the next significant level higher.
Sources: TradingView, Reuters.
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