Tech breakout wave reaches the NikkeiJapan 225 CFDFOREXCOM:JP225FOREXcomWhether you’re talking the SOX index in the United States, the broader Nasdaq, or an increasing number of other tech-related indices, the bulls are clearly starting to stir, with breakout after breakout after breakout seen over the past couple of days. The Nikkei looks like it could be next. The index broke the falling wedge it had been coiling in for well over a month on Monday, pushing through both the 50 and 100-day moving averages before stalling at 66,700, a resistance level that capped the price for lengthy periods in August and early September. While we’ve seen multiple moves through the level, none have stuck, making it the focal point today. We’ve seen the price move back above 66,700 in early Asia, albeit in thin trading with Japanese markets still closed for a prolonged five-day long weekend. As such, while there should be a caveat on the bullish price action, the close today still looms as important. With RSI (14) trending higher and now back above 50, and MACD having staged a bullish crossover and sitting on the cusp of flipping positive, upside momentum looks to be building, favouring buying dips and breakouts. If we were to see the current move above 66,700 stick, preferably on a closing basis, longs could be set above the level with a tight stop beneath for protection, initially targeting a test of 69,390, where the index has stalled on four separate occasions earlier this year. 67,366 is a level of note located in between, marking the high set on August 27. A sustained break of 69,390 would have bulls salivating at the prospect of a potential retest of the record highs at 73,520. If the move above 66,700 fails once again, it would bring the immediate bullish bias into question, opening the door to setups targeting moves in either direction. Good luck! DS