Nikkei 225 Rises later than Prime Minister Shigeru Ishiba’s Resignation
Japan’s Nikkei 225 index (Japan 225 on FXOpen) advanced today, moving closer to its historic peak (B) near the 43,900 mark.
The rally was largely supported by political developments. According to Reuters, Prime Minister Shigeru Ishiba has resigned. The frontrunner to succeed him, Sanae Takaichi, is widely viewn as an advocate of stimulus measures and aggressive monetary easing — policies considered supportive for equities.
Technical View of the Nikkei 225
The 4-hour chart shows the Nikkei in a sustained long-term uptrend, as reflected by the 200- and 400-period moving averages. Since summer, the index has been trading within a rising channel (outlined in blue), with the lower boundary acting as firm support.
Additional bullish signals include:
→ A healthy structure, with a typical 50% pullback (B→C) later than the A→B impulse.
→ A corridor formed during the B→C decline (red lines), resembling a bullish flag pattern. The breakout from this pattern points to a possible resumption of the uptrend following consolidation.
→ Former resistance levels now acting as support, including both the upper red line (arrow) and last week’s barrier at 43,150.
However, there are also cautionary signs:
→ Long upper wicks on today’s candles indicate stronger tradeing pressure near the record high.
→ The RSI indicator has entered overbought territory.
With the index currently trading around the midpoint of the ascending channel — often a zone where supply and demand balance — a short-term consolidation looks possible. From here, two scenarios may unfold:
→ An attempt to break through the historic peak, which could fail and trigger a bearish ICT Liquidity Sweep above point B.
→ A corrective move with a retest of support at 43,150.
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