Japan's Nikkei Index is losing ground with increasing strength in the Yen ($USDJPY currency pair). As is the unwritten rule, US markets drive global markets. With major indices S&P 500, Dow Jones Industrial Average and Nasdaq Composite on a slight reversal path from their all time record highs, a knock on affect on major markets is being observed.
On technical analysis front, daily chart for Nikkei Index (Japan 225) is coiling within converging wedge formation. Currently the price is testing 50-SMA at 19242 level. Reducing volumes indicate fading trading interest. RSI indicates reduced strength for price action to take immediate reversal, instead continue downward momentum as buyers kick-in. MACD is at mean levels since beginning of the year, not giving much information. In addition Japanese Yen has risen vs the USD in past few days; another factor impacting businesses and companies thereby pushing Nikkei further down.
From here, the Index could reach 19060 / 19000 level and get some support from recently formed support trend line. This could lead to a reversal up. A further continuation of zig-zag waves within wedge formation is a possibility. Or else the index could straight-away drop taking it to October / November levels. Key levels to watch are 19000 for immediate support and 19600 for resistance in next few days.