Current dynamics

Japan's leading stock index NI 225 is correcting at 38705.0, being more dependent on macroeconomic data, while bond dynamics do not have a key impact on quotes.

Thus, at the end of last week, November data on business activity in Japan were published: in the manufacturing sector, the index fell to 49.0 points from 49.2 points, remaining in the negative zone for the fourth month in a row, and in the services sector - to 50.2 points from 49.7 points. In addition, the national core consumer price index in October slowed to 2.3% from 2.4%, which will again have a restraining effect on the Bank of Japan, which is assessing the possibilities for tightening monetary policy.

With the likelihood of higher borrowing costs low, bond yields began to adjust: the rate on 10-year debt instruments fell to 1.067% from 1.089%, and on 20-year ones to 1.882% from 1.898%.

The growth leaders in the index are Keisei Electric Railway Co. Ltd. ( 14.04%), Taiyo Yuden Co. Ltd. ( 4.16%), Murata Mfg Co. Ltd. ( 4.16%), Tokyo Electron Ltd. ( 4.27%).

Among the leaders of the decline were Nexon Co. Ltd. (–2.80%), IHI Corp. (–2.83%), Mercari Inc. (–1.91%).

Support and resistance levels

On the daily chart, the price is moving away from the support line of the ascending channel with dynamic boundaries of 42600.0–38000.0.

Technical indicators are preparing to continue strengthening the previously received buy signal: the AO histogram is forming new ascending bars, and the fast EMAs on the Alligator indicator are moving away from the signal line, expanding the range of fluctuations.

Support levels: 38100.0, 36450.0.

Resistance levels: 39080.0, 40800.0.

Trading scenarios

In case of continued growth and consolidation of the price above the resistance level of 39080.0, positions for purchase with the target of 40800.0 will be relevant. Stop loss — 38600.0. Implementation period: 7 days or more.

In case of a reversal and continuation of the decline, as well as consolidation of the price below the support level of 38100.0, sell positions with a target of 36450.0 will be relevant. Stop loss - 38500.0.