Nikkei 225 Chart Analysis (May 11) | Bearish Engulfing -295 Yen, Rejection at New All-Time High
The following technical analysis is based on data as of May 11, 2026.
The Nikkei 225 closed at 62,417.88 yen on May 11, falling 295.77 yen (-0.47%). Open 63,203.44, high 63,385.04 (new ATH), low 62,380.62, close 62,417.88. From 5/8 close 62,713 to today's open 63,203, a 490-yen gap-up opening followed by an intraday break of 5/7 high 63,091 to print new all-time high 63,385, but the close was sharply lower in an open-high-style large bearish candle. The 785.56-yen large bearish body completely covers 5/8's hanging man body (59.64 yen), forming a textbook bearish engulfing pattern.
■ Technical Indicators
Moving averages: SMA5 61,352.68, SMA25 57,985.63, SMA75 55,822.08, SMA200 50,303.71. Close 62,417 above SMA5 by 1,065 — perfect order intact. SMA25 deviation +7.64%, SMA75 deviation +11.82% — still far above caution.
RSI 68.15, marginally lower from 69.93, brushing 70 overbought. MACD 1,799.91 / signal 1,509.11 / histogram +290.80 — fresh high levels. Stochastic %K 80.49 / %D 89.60 — %K crossed below %D in dead cross, overheating-relief phase begins. Ichimoku: thick bullish cloud, price well above, three-fold bullish setup intact.
■ Bollinger Bands
Upper 63,023.99, middle 59,173.55, lower 55,323.11, bandwidth 13.01%. Today's high 63,385 pierced upper band 63,023 but close pulled back toward middle — +2 sigma rejection. Bandwidth contracted further from 14.65% to 13.01%.
■ Chart Pattern Analysis: Bearish Engulfing
Today's candle forms a textbook bearish engulfing. Conditions: (1) appears at topping region of uptrend, (2) prior bullish (small body OK), (3) today's bearish body fully covers prior body. Here: (1) topping region after the first-ever 63,000 touch on 5/7 (✓); (2) 5/8 hanging man small bullish body 59.64 (O 62,654, C 62,713) (✓); (3) today's bearish body 785.56 (O 63,203, C 62,417) fully covers prior 62,654-62,713 (✓). Today's gap-up open further strengthens the signal. Bulkowski's topping-region reversal-continuation rate around 65%; combined with 5/8 hanging man as a 2nd-bar confirmation, reliability rises.
■ Support and Resistance
60-day range: 50,558.91 to 63,385.04 (today's new ATH). Today's close at 92.46%. Resistance: 63,385 (today's high / new ATH), Bollinger upper 63,023, 5/7 high 63,091. Support: 62,380 (today's low), pivot 62,070, psychological 62,000, SMA5 61,352, 5/7 open 60,241.
■ Volume and Sentiment
Volume 202.3 million versus 20-day average 163.5 million yields 1.24x — surging (increasing). Bearish engulfing + volume expansion significantly raises reversal-signal reliability. Multi-timeframe stays daily / weekly / monthly all strong uptrend with full alignment.
■ Market Environment
The weekend-induced gap-up open → new ATH print → close-basis decline pattern indicates that opening buying triggered by strong overseas markets was overwhelmed by profit-taking. US economic data and Japanese GDP preliminary release this week may catalyze overheating relief.
■ Outlook and Scenarios
Bullish: Volume-backed clear break above 63,385 invalidates engulfing; psychological 64,000 next target. Bearish: Break below 62,380 / SMA5 61,352 confirms engulfing reversal, with 5/7 open 60,241 / psychological 60,000 in scope. Neutral: 62,000-63,000 range for consolidation.
■ Summary
May 11 bearish engulfing + volume expansion compound reversal signal. Key levels: upside 63,023 / 63,385, downside 62,380 / SMA5 61,352. Combined with 5/8 hanging man as a two-bar topping candidate; confirmation bearish candle tomorrow becomes the decisive factor for top formation.
* 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.