Nikkei Weekly Chart as at July 26, 2013

Since beginning of 2013 US, Germany and Japan Equity has taken lead in world equity and has out-performed EM equity - e.g. BSE Sensex. However, Before Sep 2013 we expect downtrend in every risk assets because we expect Europe problems to re-emerge. This downtrend we expect to continue up to Mid 2014.

We attach Nikkei weekly chart:

If we see weekly chart of Nikkei we see that in the last week it has made lower top than May 2013 top of 15942. Currently index is above support from rising trend line connecting Oct 2012 and June 2013 lows. However, We expect this support to break and we may see good amount of correction in Nikkei once Europe issues re-emerge. Also,In longer term Nikkei chart we see strong resistance around 16000 levels from falling trend line connecting 1996,2000, 2007 and 2013 highs which means most likely 16000 will NOT be broken in 2013.

Posted in: Indian Market