One of the steadier stocks, and companies, in the U.S. stock market over the last half decade has been Nike (NYSE:NKE). It is currently testing a key level on its chart, however, that may present a challenge to its longer-term uptrend.
Let’s look at chart below and discuss some key price levels and movements in the lead up to this “test”.
In March 2009, Nike stock price put in a long-term low (along with most of the equity market) at about $9.50.
After rallying nearly unabated for 3 years, NKE consolidated throughout the middle of 2012, before launching again in November from about the 22.50 level.
A trendline drawn on a log scale connecting the 2009 and 2012 lows intersected the June 2016 lows precisely, near $51.50. And yesterday, Nike stock again tested the post-2009 Up trendline, currently around the $54.50 level.
Continue to monitor this post-2009 Up trendline as a basis of potential support. Holding above it will sustain NKE’s uptrend. A break below opens up more downside, first to the June lows around $51.50 and, secondarily, perhaps down as low as $45.00.
Thanks for reading.
Twitter: @JLyonsFundMgmt
The author does not have a position in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.
