Central Plain Shun Report No.112 July 19, 2021

※ Price Revision Notice

The price of the “Nakahara Shun Report” provided by GogoJangan will be revised as follows from August 1.

Old 2,000 yen

New 2,200 yen

※ The new price will apply from issue dated August 2, 2020.

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1. Points

＜Dow Jones Industrial Average＞
1. Medium-to-long-term outlook (June 2021 marks the first 15.5-month cycle bottom. Entry into the second 15.5-month cycle) No change

The 4-year and 12-year cycles bottom out in March. The first 15.5-month cycle is considered bottomed out on June 18. The second 15.5-month cycle should rise at least to half of that cycle, around February 2022.

2. Short-term outlook (Fifth week of the new PC. The 15.5-month cycle is also considered bottomed. Note the timing)

Fifth week of the new PC. The low on June 18 is a simultaneous bottom-out of the PC (15 weeks) and the 15.5-month cycle (15th month). The first phase of the 15.5-month cycle is always bullish. The 15th may be the top of the MC, but even if surpassed, this week through the 30th is a time window where the MC top can occur at any time. However, since this is the first MC, the pullback may be very shallow. Use the first MC as a buying pullback.

3. Cautions (the previous PC’s 20th week. The 15.5-month cycle declines concurrently, and the current period through the first week of August continues to fall) No change

If you still believe neither the 15.5-month cycle nor the PC has bottomed out, it wouldn’t be surprising to resume a sharp decline at any time from this week onward. Sell on rallies, assuming a continued fall until around the first week of August. Consider this a sub-scenario.

＜Nikkei Stock Average＞
1. Medium-to-long-term outlook (May 13, 2021 marks a 15.5-month cycle bottom. Rise in the second 15.5-month cycle) No change

The 4-year cycle bottomed in March 2020. The first 15.5-month cycle bottomed on May 13 (though price-wise it must clearly break above 29,500; this condition has not yet been met). Once bottomed, expect a 3–4 month upward wave. However, the 15.5-month cycle may still have a bottom target around mid-July and might not have bottomed yet.

2. Short-term outlook (The 10th week of the PC that started on May 13. Buy the HP-C bottom on pullback) No change

10th week of the PC and 4th week of the second MC. The current decline is interpreted as a drop to the HP-C bottom. Any pullback should only reach the double-bottom level (27,300). After confirming reversals on July 20, July 30, and August 6, buy on the pullback.

3. Cautions (the previous PC’s 20th week. PC bottom is expected, so confirmation of sharp drops/rises is required) No change

Sub-scenario assumes the PC’s 20th week and the second HP-C’s 10th week. The 15.5-month cycle has not bottomed out yet and could drop significantly from here. The decline could reach as low as 25,300. Reversal could occur at any time from this week onward. Buy only after a solid reversal.

To read the continuation, please refer to the PDF file.