The JP 225 stock index has formed a sideways channel within an overall uptrend. Today’s JP 225 forecast is positive.
JP 225 forecast: key trading points
- Recent data: Japan’s core CPI came in at 3.3% in June
- Market impact: this signals slower price growth, which may positively affect the Japanese stock market
JP 225 fundamental analysis
Japan’s core Consumer Price Index (core CPI) for July 2025 stood at 3.3% year-on-year, below the forecast of 3.4% and the previous reading of 3.7%. Lower inflation reduces pressure on the Bank of Japan to tighten monetary policy. This creates a positive environment across most sectors. Consumer companies stand to benefit the most, as the risk of falling real incomes lessens. Technology and export-oriented firms also benefit, since weak inflation increases the likelihood of continued accommodative monetary policy.
The financial sector, on the other hand, may be at a disadvantage because easing inflation reduces the odds of interest rate hikes, thus capping banks’ margin growth. Meanwhile, the construction and real estate segments may gain support amid expectations of continued low borrowing costs.
Japan core inflation rate: https://tradingeconomics.com/japan/core-inflation-rate
JP 225 technical analysis
The JP 225 index broke above the resistance level, aiming for a new all-time high. The support level has formed at 39,410.0, with resistance yet to form. There are currently no market signals indicating a trend reversal. Therefore, the price is expected to reach a new all-time high.
The following scenarios are considered for the JP 225 price forecast:
- Pessimistic JP 225 scenario: a breakout below the 39,410.0 support level could send the index down to 37,455.0
- Optimistic JP 225 scenario: if the price consolidates above the previously breached resistance level at 40,635.0, the index could climb to 42,535.0
JP 225 technical analysis for 24 July 2025
Summary
The inflation data will likely be seen as moderately positive by the market, especially if investors continue to bet on the Bank of Japan maintaining stimulus. However, the central bank has publicly stated its intention to tighten monetary policy. The JP 225 index has exited the local sideways channel while remaining in an uptrend. The next upside target is 42,535.0.
Source: Roboforex
