The Nikkei has Put in a Bullish Hammer: More Upside to Come?

After the strong selloff in US stocks overnight and the backdrop of a suspected terror incident out of Spain, there appeared to be every chance of a continued selloff in Asian equity markets. That didn’t eventuate and in fact the Nikkei has started to put in a strong candlestick pattern that can often lead to a rally.

There is a clear hammer on the 4-hr chart and indicates that while the sellers tried to come in, buyers won the battle. We often use this type of candlestick pattern as a reversal.

Sometimes Asian markets don’t always continue with the momentum that is generated in the US sessions. That’s because the news is already factored into the market. In the event of negative news, that can often be overdone – which appears like it might be the case here.

For the remainder of the Asian session there might be some opportunity for an upside move in the Nikkei given the bullish chart pattern.

ABOUT THE AUTHOR See More

Rowan Crosby

Asia-Pacific Analyst

Rowan Crosby is a professional futures trader from Sydney, Australia. Rowan has extensive experience trading commodities, bonds and equity futures in the Asian, European and US markets. Rowan holds a Bachelor of Finance and Economics degree and is focused heavily on Investment Finance and Quantitative Analysis.

Related Articles

Comments

0 0 votes

Article Rating

Subscribe

Login

Notify of

new follow-up commentsnew replies to my comments

Please login to comment

0 Comments

Oldest

Newest Most Voted

Inline Feedbacks

View all comments