The JP225 stock index has been ascending since June 4, from the low of 20,276 to a two-month high of 21,796. The index gapped upwards on July 1, only to shift to a two-week trading range with lower and upper boundaries of 21,451 and 21,796 respectively.

The index currently finds support on the 50-day simple moving average (SMA), coupled with the uptrend line coming from the low of 20,276. The ADX confirms the absence of the trend, whereas other indicators agree that a short-term weakness of momentum is apparent, with the MACD, the trigger line and the RSI flattening in the positive area.

In case that, a short- to medium-term bullish bias persists, the immediate resistance of 21,708 would be tested before the two-month high and upper boundary near 21,796 would be reconsidered. Any additional gains might see next obstacle of 21,904.

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On the other hand, if the price manages to shift the sentiment bearish, and penetrate the 50-day SMA and the uptrend line, the lower boundary of 21,451 could be re-seen before the 23.6% Fibonacci of the up move from 20,276 to 21,796, of 21,436. Bearish endurance could bring into play the support areas, before the gap, of 21,276, until the 38.2% Fibonacci becomes an issue at 21,214.

Overall, the outlook in the short- to medium-term is neutral, awaiting a direction jump.


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