My last chart on the Nikkei was from this post (If I had a NIKKel for ....) on Nov 29. Here is the relevant chart:
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEjizlygJ-1ded-ff7vVWd0Rz4S1kGbw4U6jXIkwTZLoijcfqgiK0tP0db-Fpu2dPpTy3rDDo5TlyUOlrW-WuPsaWfmRS57r9cyLb-2Hw6x1bxYfmYnFdLy3rSvZOI_6Cwt1Cft3er9TmSOw/s320/0binve-001-202.png)
So indeed we got the bounce off the support line. So scenario 2 is likely to be playing out:
2) It respects the support and bounces up. However this would be a classic technical bounce to burn off oversold. The bearish implications in this scenario are much more severe. The indicators have already shown significant bearish divergence earlier this year and I am showing below a potential Head and Shoulders setup of massive proportions. This would be a very big deal
So right now there is a strong move up. But unless that move generates a higher high (which it has a bit more work to do before that can happen) I say we have a very bearish Head and Shoulders potential setup forming.
Too early to tell, of course, but worth keeping on your radar screen.
![](https://blogger.googleusercontent.com/img/b/R29vZ2xl/AVvXsEiUQr6zuIG4MlZtRgy9vKYyE3fGXAXyz8U9qgfgtw9crqdjbDINNnkjOyGoG-YXwSxNORVFZbCXgyAq6gXOM48AQamEjVCjukDSS-MIoP5MYUcL2MUDy41q1nRsnxcQBxL88Q-tqryo7Y7k/s320/0binve-001-202.png)