Japan's Nikkei 225 (JAP225 contract) is gaining more than 2% in today's session, breaking above historic ATH recorded in 1989.
Japan's economic slowdown has raised hopes since the beginning of the year that the country could maintain its ultra-loose monetary policy for an extended period of time, despite reports of the finance minister's concerns about a weakening yen. The oversold yen is attracting foreign investors as the weak currency boosts the earnings of export-oriented companies, which have a heavy weighting among Tokyo stocks.
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Open account Try demo Download mobile app Download mobile appThe Nikkei is up 17.5% year-to-date, making it the best-performing major index in the world. Not least driving the bullish momentum on JAP225 is the fact that investors have long repositioned their exposure to APAC markets due to the economic slowdown and geopolitical tensions in China.
The Japanese index has broken through the psychological barrier of late 1989. Source: Financial Times
From a technical perspective, the JAP225 index is trading above the 70 zone of the RSI indicator. Historically, the breakthrough of this zone may have been a point signaling overbought conditions for the underlying instrument. However, it is worth bearing in mind that historical correlations do not necessarily materialize. Source: xStation
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