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Cycle analysis of the Japanese stock market under Abenomics

Posted: 23 October, 2016 Subjects: Cycles Markets&Behaviours
Source: C2016 IFTA Available to: Delegates 2016

Analyzing the Japanese stock market under Abenomics utilizing the Japanese Technical Cycle analysis in combination with fundamental approach for achieving better return. This “cycle view” of the Japanese market will be examined in four main phases.

  1. Ideal Cycle
    • Remarkable improvements in corporate earnings do not show up yet
    • The effect of monetary and/or fiscal policy is expected to appear in the near future
  2. Actual Cycle
    • Remarkable improvements in corporate earnings emerge
    • Individual stocks with remarkable expected or actual earnings improvements are bought.
  3. Bubble Cycle
    • Market is considerably overheated
    • This is likely to be followed by a sharp fall.
  4. Temporary rebound in a declining market
    • After that, the market tends to enter a selling climax or an inactive phase, alongside deteriorating corporate earnings