Nikkei 225 Short Term Elliottwave Update 5/22/2015

Decline to 19033 completed wave ((X)), and the Index has since resumed the rally in wave W in the form of a double correction ((w))-((x))-((y)) where wave ((w)) ended at 19843 and wave ((x)) ended at 19468. In our previous Nikkei 225 update (see related ideas below), we said wave ((y)) is in progress towards 20276 – 20472, and some profit taking should be seen from this area and the Index to pullback 3 waves lower in wave X to correct the rally from 19054.

Since our last update, current preferred Elliottwave view suggests wave ((y)) of W has ended at 20323, and wave X pullback is in progress towards the ideal target of 19514 – 19663 (50 – 61.8 back). Wave X pullback is unfolding in the form of a double correction ((w))-((x))-((y)) where wave ((w)) is expected to complete at 19996 – 20107, then it should bounce in wave ((x)) before turning lower to resume wave X pullback towards 19514 – 197663. We do not like selling the proposed wave X pullback. As far as 19033 pivot holds in wave X pullback, expect buyers to come for 3 waves higher at minimum to correct the decline from 20350 per Elliott Wave hedging technique.

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