Nikkei 225 index price closes strong at 40,487 as bullish trend extends into July
Nikkei 225 holds above breakout zone, consolidating below resistance near 40,850
Japan’s Nikkei 225 ended the month of June at 40,487.17, notching a resilient continuation of its multi-week rally from mid-April lows near 33,000. The index briefly touched an intraday high of 40,852.54 before retreating slightly, reflecting profit-taking at upper resistance levels.
Highlights
- Nikkei 225 closed June at 40,487.17 after intraday high near 40,852.54 signals resistance
- Daily breakout above 39,300–40,000 confirms bullish trend, with 42,000 next key target
- Short-term indicators show cooling momentum; support seen near 40,000 and 39,300
Despite the modest pullback, the broader structure remains bullish as price has decisively broken through major resistance between 39,300 and 40,000, now repurposed as near-term support.
Cooling indicators suggest near-term consolidation
While the broader rally remains intact, technical indicators on shorter timeframes are beginning to cool. On the 30-minute chart, RSI has softened to 59.71 after briefly nearing overbought territory, and MACD signals are converging toward neutral. Bollinger Bands on the 4-hour chart reflect a contraction phase, with price reverting toward the midline, suggesting reduced short-term volatility. This could imply a consolidation period before the next directional move.
Nikkei 225 price dynamics (Source: TradingView)
Nevertheless, the index remains well-supported above the 20, 50, 100, and 200 EMAs on the 4-hour chart, with key moving averages layered between 37,600 and 39,200. Any pullback toward the 39,800–40,000 zone could invite dip-buying interest, while deeper retracements may find firmer footing near 38,600, a level that previously served as resistance and aligns with monthly pivot clusters.
Bullish trend confirmed as resistance flips to support
The daily breakout above both the R3 and R4 monthly pivots—38,639.73 and 39,314.59—confirms a structural shift. Price is now advancing through the upper channel of an ascending pitchfork, with resistance between 40,595 and 40,850 acting as a test zone. If the index clears this cluster with volume, upside projections extend to 42,000 and potentially 43,940.46. The trend of higher highs and higher lows, confirmed by strong breakout volume, remains the dominant force entering July.
In previous reports, the Nikkei 225 was highlighted for reclaiming key EMA levels and pushing through trendline resistance during its mid-year reversal. That thesis remains intact, with the breakout above 40,000 serving as a critical validation point. Traders now await confirmation above 40,850 to unlock the next leg higher.
