Since the beginning of the year, the Japanese main index is almost flat with a minor loss of 0.1% but last week rose more than 1.0% and is in a bullish phase since mid-April. Last week the Japanese index rose with a narrow range and closed near the high of the week, in addition, managed to close above the previous week high, which suggests a strong bullish momentum. The stochastic is showing a strong bullish momentum and crossed above the 50 midline. The Japanese Index has been gradually rising since the late March bounce from the weekly support and is now testing the 23.6 Fibonacci retracement at 22,795. This Fibonacci retracement can be viewed as a key inflexion point, meaning a break above it will push the index further up and a rejection can kick-start a downward correction. Expecting an upward move to a weekly resistance at 23,440 on a break above the 23.6 Fibonacci retracement at 22,795 (scenario 1) however a break below the weekly resistance at 22,470 may bring the bears into the market pushing the index down toward the 38.2 Fibonacci retracement at 21,925 (scenario 2).