WaveTrack International

Elliott Wave Financial Price Forecasting

NIKKEI 225 – Track Record

by WaveTrack International| February 18, 2016 | No Comments

As a part of our Elliott Wave success pattern series we chose this time to show Japan’s Nikkei 225 index which underwent a spectacular reversal-signature during 2015. These patterns allow you to get insights into WaveTrack’s forecasting style and quality.

In early-December, we concluded that the top was in when the Nikkei broke below ‘4th wave preceding’ support at 19250 (futures data). Intra-hourly substructure of this initial five wave expanding-impulse decline pointed to an idealised low at 18365+/- prior to a hefty counter-trend rally.

NIKKEI 225 - 360 mins. - Forecast 16th December 2015

NIKKEI 225 – 360 mins. – Forecast 16th December 2015

In mid-December, a reversal-signature from a low at 18565 (close to the 18365+/- target range) was identified which implied that the expected counter-trend rally was underway. Upside projections basis our interrelated-market analysis suggested a very deep 2nd wave counter-trend correction to the 1st wave decline from 20060 to 18565 – the most likely target was the 19835+/- resistance area, defined by a fib. 85.4% retracement.

NIKKEI 225 - 360 mins. - Result! 22nd December 2015

NIKKEI 225 – 360 mins. – Result! 22nd December 2015

Then came the announcement by the Bank of Japan to increase their bond-buying programme and lengthen the maturity of bonds purchased in order to stimulate the economy. The Nikkei’s reaction in fact was intriguing! It spiked higher in an attempt to take out the 20060 high but failed in a dramatic fashion: within the next session it almost returned to the December lows and has since been unable to recover!

This is a fine example to underline the validity of Elliott Wave analysis. As we know due to Elliott’s guidelines and our own long experience, 2nd waves tend to be rather deep –
this is exactly what happened as the Nikkei even exceeded the fib. 85.4% retracement but failed to break the 1st wave’s high. The outlook is clear: despite the possibility of a secondary (but more docile) attempt higher as a smaller second wave, the Nikkei remains poised to the downside.

Don’t forget – our bi-weekly Elliott Wave Compass report features many short-term updates next to the Nikkei 225 of various asset classes.
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WaveTrack International is a financial price forecasting company dedicated to the Elliott Wave principle and work of the R.N. Elliott. Clients include Investment Banks, Pension Funds, Total/Absolute-Return/Hedge Funds, Sovereign Wealth Funds, Corporate and Market-Making/Trading institutions and informed individuals -- & just about anyone who is affected by directional price change.

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