NIKKEI hit the top of 17-year Channel. Huge Bear Cycle starting.
Nikkei (NI225) has been trading within a long-term Channel Up since the October 2008 bottom of the U.S. Inflation Crisis. This month it made direct contact with the top (Higher Highs trend-line) of that pattern following a strong Bullish Leg rally since the April 2025 Low on the 1M MA50 (blue trend-line).
As you can see, this pattern displays a high degree of symmetry. Its Bullish Legs can be distinguished into two categories: normal (blue rallies) and aggressive (green rallies). The one that just topped seems to be a normal one as it rose by +75.88%, similar to the +64.78% and +62.65% of the previous ones. The aggressive Bullish Legs (green rallies) have so far been two and are identical" +158.87% and +156.63%.
After aggressive Bullish Legs, the market has always pulled back to he 1M MA50 near the 0.382 Fibonacci retracement level, where it bottomed (blue circles). The normal Bullish Legs have instead had more aggressive corrections (Bearish Legs) as the two we've had so far bottomed just below their 0.618 Fibonacci levels (green circles). The latter one (March 202 even made contact with the 1M MA100 (green trend-line). Notice also that the Bearish Legs after normal rallies have also been longer in time (around 18 months) than those after aggressive rallies.
This is what we're also expecting this time around. The 0.618 Fib from the current Top is at 38500, which is our long-term Target within a 18 month time-frame. By that time it may very well make contact with the 1M MA100 again.
It is worth noting here that the 1M RSI is massively overbought, another sign of a market Top historically. The presence of the Symmetrical Support Zone also can help determine the next long-term buy entry in combination with the 38500 Target.
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