Is Japan a buy again?

July 2, 2013Blog6 Comments

In January, when the Nikkei sat at about 10,000, I blogged that it looked like the Nikkei might be a good place to be (https://www.valuetrend.ca/?p=1764). I blogged again in March and suggested that the Nikkei had more room to go (https://www.valuetrend.ca/?p=1924). The move to 15,000 was sharp and aggressive over that period. But now it might appear that the party has come to an end. Lets take a look at the charts to see if there’s any potential upside left for the Nikkei.

The daily chart shows us firm support at around 12,500 or so for this index. RSI looks a little weak, although it is recovering from an oversold position—as is stochastics and MACD. So the Nikkei would appear as an oversold candidate with proven support at current levels – at least from the neartermed viewpoint. The market broke its 50 day MA, but stands well over its 200 day MA. The distance from its 200 day MA no longer suggests a long termed overbought position.

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6 Comments

Dave July 04, 2013
What do you feel about BCE now? Is the break of it’s trend line a signal that so called safety stocks now will be taking a back seat going forward? I mention BCE because it’s so widely held and is a so called bell weather stock.
Reply
- July 04, 2013
  Hi Dave
  Yes, BCE is at a tipping point. Depending on how fine a line you draw for a trendline, it may have broken the uptrend–or…not!
  So, I am watching it with a possible interest in buying, although I dont own any now. Id like to see it stay firm before plunking my hard-held cash into this or anything right now!
  The othere telco’s look much worse–but thats not necessarily a good thing- as they may drag BCE with them. I’d say wait –thats what I’m doing.
  Reply
Marcin July 04, 2013
Could you do an analysis on the telco`s from what you expecting ? I got Telus last week in $30s it`s up a bit, so I could still get out if you anticipate more decline.
Thanks
Reply
- July 04, 2013
  Marcin–see my comment to Dave below.
  Also–I’m on BNN’s MarketCall Tonight on Monday July 8th at 6pm–please call in with your question and I’ll cover it – thanks!
  Reply
Fred Butler July 04, 2013
Keith, I am looking forward to your BNN interview next week and also your analysis of T. The chart, if I read it correctly, tells me that the $30 price bounced off support formed about a year ago, and if that holds. we have a V bottom. Your book Sideways tells me that that is rare so does not go into it. When you get to T in the show, you might elucidate a little if you can.
I have found Sideways a game changer for me. And it has triggered a thirst for more knowledge. I have ordered Martin Pring’s Technical Analysis Explained.
Reply
- July 04, 2013
  Thanks Fred
  Yeah, all of the telecoms, and REITs and utilities are oversold. The only problem is the trendline break. So, its likely you will get a rally from here. But how long will it last…that is to be seen. Either way, its looking ok for a trade.
  Reply