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In the case of the Nikkei 225, an early barrier to a continuation higher may reside around the Fibonacci level at 20,365 which has given rise to price indecision in the past. While the zone is unlikely to make or break a stock rally on its own, its influence over price should not be ignored as it may present an attractive opportunity to reduce or increase exposure depending on your directional bias.

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If bulls can retake the level confidently, subsequent resistance may come into play around the 200-day simple moving average but risks to the rally loom large as volatility rests at historic levels.