Should I trade the Nikkei?

Discussion in 'Technical Analysis' started by ccasadei, Mar 27, 2004.

  1. ccasadei


    Trade the Nikkei -- beginner questions

    I'm looking at trading after 5-6pm and was thinking about trading the Nikkei... can you give me your opinion on it?

    - Brokers - who do I need?
    - Is there a tracking stock similar to QQQ that offers high liquidity? Or, what are the most viable trading elements?
    - What about taxes?
    - Any links I can go to learn about the subject?
    - Should I not trade the Nikkei?


  2. wdscott



    I don't think you should trade the Nikkei 225. The product is traded on the CME with an average contracts traded about 3,000/day. Very illiquid. High margin requirement. More information may be found at the CME website.

    As for an ETF, there is the EWJ traded on AMEX

    iShares MSCI Japan Industry: Symbol: EWJ

    iShares MSCI Japan invests in most of the same stocks listed in the MSCI Japan Index. These stocks represent Japan's largest and most-established public companies, accounting for approximately 85% of the market capitalization of all publicly traded stocks.

    Quote for 3/26/04:
    Change 0.11
    Percentage Change 1.03%
    Open 10.75
    Hi 10.87
    Low 10.72

    Volume traded 3/26/04 12,210,000

    High liquidity but very small range and ill suited for intraday trading in my opinion. Average daily range is .20 to .30 cents.

    If I see something else I'll let you know.

    Best Regards,
    Dave Scott
  3. Are you asking if you should trade the Nikkei (which is an index) or are you asking about trading products from the Japan exchanges?

    IB provides access to the Topix futures from the Tokyo Stock Exchange and the Nikkei 225 futures from the Osaka Stock Exchange. One of the problems you will find is finding charting services for these products. You can use IB's feed with QuoteTracker as one alternative. Note that these futures trade in JPY.

    eSignal provides a data feed for stocks from the Tokyo and Nagoya Stock Exchanges but I am not aware of any US brokerages that provide access for trading.
  4. maxpi


    what is a good exchange/set of issues to trade from 6pm pacific time? I work on my autotrading stuff from about 6 to 10 pm, could be trading too.

  5. cmaxb


    How about the Hang Seng? Big range, stops are problematic. Liquid for small number of contracts. High margin reqs., though IB is the best in this regard.
  6. kiansoon


    One way to trade the Nikkei would be via the Singapore Exchange, where it is cheaper than Osaka to trade the nikkei. However, IB don't have the contract I think. You'll have to get one of the Singapore brokers to do this. Might be quite troublesome if you're not in SIngapore.

    Hope that helps.

  7. If you live in the US, then I think you should trade the Nikkei.

    My reason for this is simple. When you talk to the average person down the street or watch TV, people are not talking about the Nikkei. Thus, there is a lot less influence of your own opinions toward the Nikkei.

    When I traded the Nikkei futures, I was successful. I had to stop because it was too time consuming with tradiing the US futures and the Nikkei futures and I am on the East coast of the US.

    If you live on the West coast of the US, then trading he Nikkei is ideal with the time difference.
  8. kiansoon


    May I know when were you trading the nikkei? IMHO, Nikkei seems to be a little different now from a few years ago...

    Range is much smaller now than before. However, seems to be getting better by the day... maybe the long overdue bull market is finally starting in Japan.

  9. I don't think the bull market is overdue in Japan.

    I could see it falling right back down again. I would not fight the trend. It's still down until we have a bigger move to the upside, and then a nasty retracement to the downside on the monthly charts...That would prove to me that we could rip up on the Nikkei.

    When I meant that I was trading N225, I was referring to daytrading it. I would trade the first 2 hours before the first break of the day.

    Will you be trading on the Osaka exchange or the SIMEX?

    Osaka is electronic, and SIMEX is pit traded. Osaka is very liquid.
  10. kiansoon


    Would trade in Simex, or SGX-DT as they now call it. Because of the commissions. It is much cheaper in Singapore than in Osaka.

    #10     Apr 19, 2004