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The worlds third largest economy announced overnight that it was slipping into recession, shares CNBC this morning. (see article here)
This news appears to have surprised a few people and raises some questions if policies of devaluing the yen by Prime Minister Shinzo Abe, might not be working as planned.
From a “Power of the Pattern” perspective, this news could be coming at an important price point.
The Nikkei 225 is now nearing prices where it peaked back in 2007 and it is nearing resistance line (1) in the chart above with momentum nearing levels seldom seen in the past 25-years.
The reality of the Nikkei is this…it remains inside of a sideways trading range (2) that has been in place for over a decade, with it now at the upper limits of this range.
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