Since last October when Nikkei violated the long short term channel has been gained more than 70%, since this January more than 50%. Since end of this May Nikkei has been been only ranging and consolidating. What seems now clearly there is a key resistance at 15.700 now the price is fluctuating around 15.450. Can be sure if that resistance is taken the bullish run continues further. We are so close for that level, less than 2% so it might happen any day. If it is broken the next target for Nikkei must be the 20.000. Still we are far from the historical high which was above 40.000.
And what is the realistic scenario for 2014? There are some argues about this year 50% gain means the market is overbought, meaning bubble. I am convinced about that is not bubble yet. It is only a kind of strong run after almost two decades of falling market. Normally after this sort of bullish year in the following year keep going the bullish upside run. Maybe not that strong as this year but still produce nice returns.
The upside potential is still strong in 2014. So the long term opportunities are very good regarding the Nikkei.
Fundamentally there are few remarkable datas:
- The growth – this year Japan GDP is in 3,5% plus
- Inflation – the prices after decades started to rise again, which boost the corporate profits up
- Aggressive asset buying program by BoJ – which offers cheap money for the market
- P/E ratios are big time lower than in US – most of company shares are good bargain
Take a look at our Swiss fund and begin to invest with us!
The BFM Assets Team.
No comments:
Post a Comment