Nikkei 225 index price holds above 38,800 as bulls eye breakout beyond key resistance zone
The Nikkei 225 Index extended its bullish advance on June 18, 2025, closing near 38,885 and marking a new breakout above key horizontal and trendline resistance. The rally, which has gained momentum since early June, reflects strong technical conviction as the index reclaims key moving averages and breaches a longstanding descending channel.
Key highlights
- Nikkei 225 trades near 38,885 after breaking above long-term descending channel
- 20/50/100/200 EMA alignment confirms bullish trend across 4-hour and daily timeframes
- RSI signals overbought levels, raising potential for short-term consolidation near 39,000
Investors are now watching the 39,000 psychological barriers, last seen in mid-2023, for signs of sustained breakout strength.
Nikkei 225 index price forecast (Source: TradingView)
Daily chart analysis shows that the former supply zone at 38,000–38,200 has now flipped to support, as recent closes confirm a shift in market structure. Price is approaching a red resistance block between 39,000 and 40,000, a zone that previously capped rallies in multiple attempts through late 2023. A confirmed breakout beyond this zone could target 41,400 and even the 2021 peak near 42,000 if momentum persists.
Momentum builds but overbought conditions emerge
The 4-hour chart reveals a well-aligned 20/50/100/200 EMA structure, all sloping upward and providing dynamic support. Price continues to ride the upper Bollinger Band, and volatility expansion is underway as the bands widen. RSI on the 30-minute chart touched 79—indicating possible exhaustion—while Ichimoku signals on the same timeframe support further gains, with price well above the Kumo and a bullish Chikou Span lead.
Momentum indicators such as MACD and the Bullish Percent Barometer (BBP) also confirm strength. MACD is rising with positive histogram bars, while BBP reads at 905, suggesting strong breadth behind the move. The Directional Movement Index (DMI) on the 4-hour chart shows a +DI dominance with an ADX of 38, reinforcing the trend strength.
Outlook favors continuation above 38,200 base
Short-term support remains firm at 38,015–38,200, with deeper support at 37,300 should any correction unfold. However, as long as the index holds above 38,200, the broader bullish structure remains intact. Traders will be monitoring price action near 39,000 for potential signs of consolidation, RSI divergence, or volume fade before another push higher.
In earlier analysis, we noted that the 38,000–38,200 resistance band was pivotal. The Nikkei has now successfully reclaimed this zone and is moving toward the 39,000–40,000 ceilings. The technical breakout reinforces our view of continued bullish control, pending confirmation through volume and a close above 39,000.
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