After a run-off vote, Fumio Kishida won the Japanese Liberal Democratic Party leadership race. This also means that Kishida, a former long-time foreign affairs minister, will be elected new prime minister of Japan. In a post-election speech Kishida said that fighting with the coronavirus remains priority and that tens of trillions of yen of stimulus is needed by year-end. Kishida was one of politicans that was among favourites to succeed former prime minister Abe but has lost leadership vote to Suga.
A look at Nikkei (JAP225) daily chart shows that the Japanese index pulled back to the 29,500 pts support during this week’s sell-off. While the cash index finished today’s trading 2.65% lower, futures began to regain ground as the European session approached. As a result a pin bar candlestick pattern was painted near the aforementioned support zone. This hints that JAP225 may be about to launch a recovery move. In such a scenario, the near-term support to watch is marked with recent highs in the 30,500 pts area. Note that key resistance is marked with the potential range of a breakout from triangle pattern – 32,200 pts.