The NIKKEI 225 daily chart indicates a bullish trend is forming through an impulsive Elliott Wave structure. After completing the gray wave 2 correction, the index has entered navy blue wave 1 within the larger gray wave 3 setup. This position suggests the early movement of a fresh impulse, which could drive significant upward momentum in the coming sessions.

Navy blue wave 1 marks the starting point of this new impulsive advance. Usually, this phase features building momentum as the market gains direction. The end of gray wave 2 sets a clear stage for wave 1, typically showing steady but not yet aggressive price moves. Current developments imply that the market will continue rising gradually before meeting the next correction.

A key level to watch is 30,726. If the price falls below this point, the current bullish wave count would be invalid, and a reevaluation would be needed. This level serves as crucial support, safeguarding the low of wave 2.

The daily chart offers a broad view of the new wave structure. The present impulse wave shows potential for establishing further upward momentum. Traders should look for typical wave signs like increasing volume and a stable uptrend. However, it is normal for wave 1 to move slower compared to the stronger momentum expected in wave 3.

The next step to expect is the development of navy blue wave 2 after the completion of wave 1. This upcoming correction should offer a pullback opportunity before a stronger rally in wave 3 begins. Watching price action closely along with momentum indicators will help confirm the wave progress and spot the transition into wave 2.

Technical signals and price movements will be vital in verifying the unfolding wave structure. Moving into gray wave 3 at a higher degree hints at more powerful momentum ahead. This early stage is key for setting up positions and preparing for further upward growth.

NIKKEI 225 Wave technical analysis

Function: Bullish Trend.

Mode: Impulsive.

Structure: Gray Wave 3.

Position: Orange Wave 3.

Direction next higher degrees: Gray Wave 3 (Started).

Details: Gray wave 2 appears completed. Now gray wave 3 of 3 is active.

Invalidation level: 30,726.

The NIKKEI 225 weekly chart shows a strong bullish trend building through an impulsive Elliott Wave pattern. After completing the gray wave 2 correction, the index has moved into gray wave 3 within the larger orange wave 3 structure. This move marks entry into the most powerful phase of the trend, typically showing extended price growth and strong momentum.

Gray wave 3 usually signals the core trend segment in Elliott patterns, often bringing the sharpest price increases. Completing wave 2's correction clears the path for this major advance. Wave 3 often surpasses the reach of wave 1. Current readings suggest the market will likely continue upward strongly before meeting the next corrective move.

The weekly chart offers critical insight into the broader structure. Current action suggests a major bullish phase is developing. Moving into orange wave 3 at a higher degree indicates an even larger upward sequence may be forming over a longer timeframe.
A key level to monitor is 30,726. If the market breaks below this level, the current bullish interpretation would be invalid, requiring a new wave analysis.

Traders should watch wave 3’s growth for classic signs such as strong momentum, rising volume, and smooth upward progression. Analysis recommends maintaining bullish exposure during this impulsive phase but staying alert for signals of wave 3 nearing completion.

The next expected movement is gray wave 4 after gray wave 3 completes. This correction should offer a good pullback chance before any further extension of the bullish trend.
This current phase typically provides the best conditions for trading within Elliott Wave progressions.

Technical Analyst: Malik Awais.

NIKKEI 225 Wave technical analysis [Video]

Author

Peter Mathers

TradingLounge

Peter Mathers started actively trading in 1982. He began his career at Hoei and Shoin, a Japanese futures trading company.

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