Today’s Japanese Stock Market Strategy
Strategies
- Buy High-Tech Stocks.
- Sell Crude Oil-Related Stocks.
- Buy Biotechnology Stocks.
Explanation
Due to the continuous decline in interest rates, executing trades to buy high-tech stocks is recommended. Focus on semiconductor stocks, including Laser Tech, where clear buying interest exists. On the other hand, IT stocks, such as M3, have experienced a rating downgrade, so caution is necessary.
Crude oil prices have returned to levels seen just before the Middle East tensions. Therefore, it is advisable to sell high-performing crude oil-related stocks such as INPEX. Since the opening prices are expected to be lower, it’s wise to trade within the daily candlestick’s low and avoid overcommitting.
Regarding biotechnology stocks, recent trading volumes have been low. Keep an eye on the order flow, and if buying interest continues, consider buying gradually. Stocks like Sojitz and GNI might be good options.
Review of Today’s Japanese Stock Market
Prominent Movers
- Laser Tech
- None
- None
Explanation
Semiconductor stocks showed strong movements, with Laser Tech forming a large bullish candlestick and relatively small market cap companies like Socionext also rising. This strength does not appear to be a result of a one-time event but rather sustained buying due to the decrease in interest rates.
Given the prolonged strength, it might be a good idea to switch sectors. Transitioning from semiconductor stocks to machinery stocks seems favorable. Today, Murata Manufacturing and TDK performed well. TDK reached a new year-to-date high. For low-risk investments, these stocks seem promising.
Tomorrow is the SQ (Quadruple Witching) day. Judging from the closing prices of stocks today, many are likely to start with an uptrend. Instead of focusing on SQ-related stocks tomorrow, it might be a solid trading strategy to concentrate on small-cap high-tech stocks. Some slightly older stocks on the Mothers market showed upward movement today. Therefore, stocks like Mercari, JTOWER, and Bengo4.com are worth considering.
Conclusion
Consider sector rotation for your investments.
