N225 not only failed to hold 15,500, it fall through the 15,000, all within 5 trading days. The single day drop on Friday is a whopping 454 points, close to 3% (2.98%). This could be a simple knee jerk reaction to the geopolitical uncertainty. Or could it be more, something else?
Looking at the bigger picture on daily chart, this week drop definitely gives a pause/stop to N225 past weeks uptrend move. We have a clear lower low. If we get a lower high, especially below 15,000, we might simply have a trend change, at least short term. And there is nothing in between till the next round number support at 14,000. Let's see.
In last week post, I mentioned about the long pin bar could be a false break. My concern seems valid. This week long red bar break through the 15,500 - 15000 range decisively. If it continues its downward move, we are looking at 13,900-14,000 range for support.
NKVI gained a whopping 38.48% gain for the past week. This put NKVI back to mid twenties. And this stops (at least temporary) my concern/worry of the repeat of end 2012 long rally.
It seems that mean reverting for volatility is working. We are back to the 20-30 range for 5 year chart.
SPX closed at 1931.59, up 22.02 points on Friday, despite a big sell off in Asian stock. This should at least give a pause/stop to the big decline for N225 when it opens on Monday.
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