Today’s Japanese Stock Market Strategy
Strategies
- Sell High-Tech Stocks.
- Buy Oil Stocks.
- None
Explanation
In the medium term, we want to buy high-tech stocks, but the current market sentiment is very negative. Therefore, we want to respond with selling in the short term, at the level of day trading, until the market sentiment improves. For example, stocks like Emurgo and Mercari should be sold. It’s advisable to actively sell stocks that are approaching recent lows. However, it’s crucial not to hold onto these sell positions for the upcoming days; a flexible approach is necessary.
Regarding oil-related stocks, as usual, if there is a significant increase in trading volume due to a substantial price increase, we want to buy along with this surge. INPEX and ENEOS are promising targets.
Review of Today’s Japanese Stock Market
Prominent Movers
- Overall selling in high-tech stocks
- BayCurrent
- Railways Stocks
Explanation
Futures, which started at 8:45, were immediately sold off. Although there was an attempt to recover, the market fell again to new lows. Observing this movement, we decided to start selling high-tech stocks. Many stocks were breaking recent lows, and this strategy worked well. However, some stocks have long lower shadows, indicating potential reversals. Care should be taken not to chase these stocks further, as unexpected losses might occur.
Speaking of high-tech stocks, BayCurrent, a company that announced its earnings on Friday, experienced a significant decline, hitting the limit down. BayCurrent, along with SHIFT, was a representative of Japan’s mid-sized high-tech companies, but it has now fallen drastically. This decline demonstrates the poor supply and demand situation in high-tech stocks. We need to observe whether this price movement will be a temporary setback or if a continuous decline will occur.
Despite not being a hot topic, railway stocks continue to decline. Not only JR companies but also private railway companies like Keio are very weak. I noticed the negative sentiment last week but couldn’t find a solid reason to sell, so I ignored it. However, they fell significantly today. The reason is still unclear; I will make a note of it for future reference.
The market is expected to continue its volatile movements due to international situations. Although the high volatility might be stressful, it’s essential to concentrate on understanding which stocks are being sold and which ones are holding their value.
Conclusion
The sentiment is negative, but we should look for stocks with strong fundamentals and holding power.
