I did some long side trading in the $NIKK following the 2011 quake / tsunami partly
because of the old maxim that chartwise, all price gaps get filled. The trades were
ok, but it took quite some time for the market to fill the gap down in price that came with
those horrible events. Japan has taken a turn to heavy duty QE in an attempt to bolster
its very low growth and to shake off deflation pressure. This move has triggered a
parabolic run up in the NIKKEI since last Dec., a run which has created one of the
strongest overboughts ever seen in the modern era for a major market. On its way
up, the index experienced several gaps up in pricing and you have to wonder whether
and when the larger gaps will be filled by corrective price action. $NIKK Daily
Truly rowdy stuff.
- Peter Richardson
- Retired chief investment officer and former NYSE firm partner with 50 plus years experience in field as analyst / economist, portfolio manager / trader, and CIO who has superb track record with multi $billion equities and fixed income portfolios. Advanced degrees, CFA. Having done much professional writing as a young guy, I now have a cryptic style. 40 years down on and around The Street confirms: CAVEAT EMPTOR IN SPADES !!!