The Nikkei 225 has arrived at a potentially significant level at the same time as the S&P 500 ( see my previous post)
The rally since last August in the Japanese index has been in a 5 swing structure as shown on the chart above
When the 5th swing ends you often get a significant correction or reversal
With these 5 swing moves you can also use Fibbonacci projections to indicate levels for a potential end of the 5th swing.
We are now at a cluster of these Fib projections. They consist of 38.2% of 0/3 from 4; 161.8% of 3/4 from 4 and a 78.6% retracement of the last major down swing
As with the Gartley set up, you need to make a trend peak at this cluster level for it to be significant