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Nikkei 225 warning global stock meltdown see daily chart MACD


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Always brilliant commentary . I've been a way a while doing other stuff but had to come back with this observation of the Nikkei 225 which I've been tracking for years. Long timeframe but worth noting. Hopefully worse case scenario can be averted.

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What would happen to the YEN if this is the beginning of a bear market?

 

"

TOKYO -- The Bank of Japan's unprecedented buying of exchange-traded funds leave the central bank increasingly vulnerable to a stock market downturn when it comes.

The BOJ held a staggering 20.3 trillion yen ($182 billion) worth of Japanese-equity ETFs as of Sept. 30, up 4.4 trillion yen from six months earlier, data released Tuesday shows. That figure is 2.5 times the bank's capital of 8.1 trillion yen and could top 3 times by the end of the fiscal year next March"

 

"Estimates show that the market level where the central bank's paper gains would turn to losses lies at around 16,000 for the Nikkei Stock Average, compared with the index's current level of around 22,500. The longer the central bank continues buying, the higher this break-even point will rise."

 

https://asia.nikkei.com/Markets/Tokyo-Market/BOJ-seen-sitting-on-ETF-time-bomb-as-pile-reaches-180bn

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Hi . 

Interesting bespoke macd settings 121, last cross over early 2015 but what about your BBands? or are they saved for the lower time frames. 

The central banks are thinking about having a go at attempting to ease off the stimulus pedal but what will happen??? 

I was looking at the recent COT report and the interesting steep rise in volume for indices this 1st quarter (centred on Dow), there was an initial high volume drop but levelled out since and large speculators still remain net long. Interesting.

 

vol1.PNGvol2.PNGUS30(£)Weekly.png

 

 

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This MACD idea was just something I stumbled upon in my research and looked interesting. I have not tested it going back decades. It just appeared something useful for the present 10-15 years. Whenever I see a cross, I just think hope the G's will be able to deal with it. Of course there is no guarantee this trend pattern will repeat, but there are a lot of fundamentals at play out there at the moment which could make things repeat again like before.  I don't think my Bollinger Band ideas come in useful here. I tried 800 instead of 20 but think they just add confusion. I like playing around a lot with averages 800, 500, and 34 and that's how I discovered this trend pattern.

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Although I agree that technical analysis is great for increasing the probability of a scuessfull execution and gives evidence to suggest where a market could be moving, as well as being useful for gauging entry and exit points, I feel it makes up maybe 40% of my trade decision FOR ME. Obviously different things for different people work...

 

... but what I wanted to get in this thread is a thoughtful input on the fundamental and technical crossover. For example - what is the underlying fundamental factor that could initiate the sell off? Trumps shenanigans could be a factor, but less so for the nikkei I would expect. Increase in global inflation is too obvious and the central banks would be not only raising those soooo slowly but also have other macro figures firmly in their sights. There don’t seem to be any mega geo political events on the horizon. (Brexit maybe but again, maybe only for the uk and it’s a ‘known’ event).

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I like your thinking on this subject. All I know is that policy changes or disagreements between powerful forces can magnify normal cyclical trends. My MACD isn't really tradable as it plays out over a long period of time - probably of more value to an economist. I think it also worked for the Dotcom crash.

 

interesting reports I picked up recently:-

 

John Kicklighter posted on his twitter account yesterday he is a chief streategist at dailyFX.com owned by IG:

 

"Since the $SPX's run above its 200DMA was unceremoniously called to an end, here's the Dow's - 444 trading days. Longest since June 1987" (he shows a chart)

 

also

 

"Peter Schiff Warns 'Deep State' Unafraid To Crash The Market On Trump's Watch" reported by zerohedge.com 4/4/2018 and many other sites.

 

I've also heard said "What trade war more like trade squabble".

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