Nikkei 225 Chart Analysis (May 22) | Three Outside Up Complete +1,654 Yen, ATH 63,799 Within Reach

The following technical analysis is based on data as of May 22, 2026.

The Nikkei 225 closed at 63,339.07 yen on May 22, adding 1,654.93 yen (+2.68%) for a 2nd consecutive advance following 5/21's sharp rebound. Open 61,913.36, high 63,432.41, low 61,842.56, close 63,339.07. A 1,426-yen large bullish body with 93-yen upper shadow and 71-yen lower shadow — both tiny, body 89.7% of range. The 3-candle sequence of 5/20 bearish belt hold, 5/21 bullish belt hold-like (body 1,309), and 5/22 large bullish completes a three outside up reversal continuation pattern, fully invalidating the pre-5/20 bearish signals.

■ Technical Indicators

Moving averages: SMA5 61,238.83, SMA25 60,564.50, SMA75 56,833.73, SMA200 51,180.92. Close 63,339.07 well above all moving averages — perfect order fully restored. SMA25 deviation +4.58%, SMA75 deviation +11.45% — caution-level overheating re-acceleration.

RSI 64.13, up sharply from 58.61, 5.9 points to 70 overbought. MACD 1,255.60 / signal 1,423.01 / histogram -167.41. Histogram contracted sharply from -303.61 to -167.41 — improvement continues, MACD dead cross resolution imminent. Stochastic %K 90.55 / %D 55.04 — %K fully overbought. Ichimoku: thick bullish cloud, price well above, three-fold bullish fully established.

■ Bollinger Bands

Upper 64,007.05, middle 61,064.09, lower 58,121.13, bandwidth 9.64%. Today's close 63,339 sits 668 yen below upper band — stalled just under +2 sigma. Bandwidth essentially flat. +2 sigma breach in scope soon.

■ Chart Pattern Analysis: Three Outside Up

Today's candle completes a 3-candle three outside up pattern. Conditions: (1) prior bearish, (2) middle bullish covering (engulfing) the prior body, (3) today's bullish close above (2)'s close. Here: (1) 5/20 bearish belt hold body 763 (O 60,567, C 59,804) (✓), (2) 5/21 bullish belt hold-like body 1,309 (O 60,374, C 61,684) covers main of (1) (loose engulfing) (✓), (3) 5/22 large bullish close 63,339 > (2)'s close 61,684 by 1,654 yen (✓). Three Outside Up is the completion form of outside engulfing (bullish engulfing); Bulkowski's reversal continuation rate around 80% — extremely high reliability as strong reversal continuation signal.

■ Support and Resistance

60-day range: 50,558.91 to 63,799.32. Today's close at 96.52% — near absolute top. Resistance: 63,432 (today's high), 5/14 high 63,799 (ATH), Bollinger upper 64,007, pivot 63,900, psychological 64,000. Support: 61,842 (today's low), pivot 62,310, psychological 62,000, SMA5 61,238, Bollinger middle 61,064.

■ Volume and Sentiment

Volume not finalized at writing time. 5/21 volume 166.6M (0.94x average) was modest, but today's surge fully reverses sentiment. Multi-timeframe stays all strong uptrend with full alignment restored. The descending triangle downside break from 5/19-5/20 is now confirmed as fakeout.

■ Market Environment

From 5/20's psychological 60,000 break, 2-session +3,535 yen (+5.91%) V-shaped recovery. Overseas risk-on, FX stability, and semiconductor/tech buy-back in background. 5/14 ATH 63,799 within striking range; new high update is the immediate focus.

■ Outlook and Scenarios

Bullish: Volume-backed break above 5/14 high 63,799 / Bollinger upper 64,007 / psychological 64,000 restarts blue-sky territory. Fibonacci extension 1.272x at 67,002 as next target. Three Outside Up completion reliability is high, bullish continuation confidence elevated. Bearish: Break below psychological 62,000 / SMA5 61,238 invalidates pattern; 5/20 low 59,292 retest pressure. Neutral: 62,000-63,799 range while overheating cools at +2 sigma.

■ Summary

May 22 three outside up completion fully invalidates pre-5/20 bearish signals, returning to within striking range of ATH 63,799. Key levels: upside 63,432 / 63,799 / 64,000, downside 61,842 / SMA5 61,238. New ATH update attempt and +2 sigma break / RSI 70 overbought timing are the touchstones for blue-sky territory restart.

* This article provides information based on technical analysis and does not constitute a recommendation to buy or sell any specific security. Investment decisions are your own responsibility.