Nikkei reversing or correcting?

 I am easily influenced by others, especially when the person is of authority level. 

I have for a while managed a regular gain in my trading through stringent control on my trading strategy, especially setting fixed gain utilizing Fibonacci ratio. I attended a session featuring one of my teachers in trading. By the end of the session, I have decided to be bolder and removed trade target.

The result was a disaster! Within a day, I ended with 3 consecutive losses, triggering the need to stop trading. I could not accept that it was a problem in my trading and must be market abnormality. Of course, something seems unfamiliar with the market, the spread of the bars has increased and so did my risk level, my value per bar is much smaller and I need larger move for similar gain.

I have also added Average True Rage(ATR) to my charts, however, it took some time to really understand the impact of this indicator on my chart read. It actually made me think that I should be earning more than I should and led me to sit in the trade much longer. 

It was a good thing that once I faced issue with my trade, I moved into demo trading, which allow me to check what went wrong.

As for today, let's look at Nikkei.

Fig 1 Nikkei 225 weekly chart

It is interesting to note that Nikkei started to rise by March 2020, the start of the pandemic, it seems like the Chinese meaning for 危机 is true, when there is danger, there is opportunity. 

The climb in Nikkei reached a peak by February of 2021, it then went through a long correction phase until August when the weekly chart was supported by its 55-week moving average. While gaining a mildly new height, it quickly retreated, it tested the previous low, which again stopped by 55-week moving average. and until last week, the third time, may be third time's a charm?

My question is: how do I determine its trend? Is it going to be up or down? I am not 100% sure, 

If I am to decide, I would be the gradient of the down trend pointed by the red arrow. The descent is very steep, indicating a lot of momentum in the down trend. The correction thereafter with a more gradual gradient and did not manage to reach its previous peak. 

Additional observation would be divergence in the 8-week moving average, its second peak is lower than the first. 

There is however no divergence in the 21-week moving average, probably indicating a  short term correction.

While the move this week is positive (green bar), my feel is that it is pull back before it pounces through the 55-week moving average this time round,  

 Using Fibonacci projection, the next support level should be between 25,097 and 26,176. I might find the 25,097 level to be more prudent since it also coincides with the 38.2% Fibonacci retracement line.

I am using 8-week average for ATR, the fluctuation is about 1,000 points.