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by Charalambos Pissouros

Nike Slides and Breaks Below 82.50

Nike Inc (NYSE: NKE) traded lower yesterday, breaking below the 82.50 level, which provided support on June 10th and 12th. The stock continues to trade above the long-term tentative upside support line drawn from the lows of October 2017, but since April 18th, when it hit its all-time of 89.99, it’s been showing respect to a short-term downside line. Having that in mind, and also that the price is decently above the aforementioned long-term line, we believe that there is room for some more near-term declines.

We believe that the dip below 82.50 may have cleared the way towards the 81.00 zone, which stopped the share from falling lower on March 25th and May 13th. If that zone fails to halt the slide this time around, its break may set the stage for the 78.70 barrier, marked by the low of June 4th. Another dip, below 78.70, may allow extensions towards the trough of May 31st, at around 77.00.

Looking at our daily oscillators, we see that the RSI ticked below its 50 line, while the MACD, although above its trigger line, shows signs of topping slightly below zero. These indicators suggest that the momentum is shifting back to negative and corroborate the case for some more declines.

On the upside, we would like to see a decent rebound back above 85.50 before we assume that Nike has gained back investors’ interest. Such a move would confirm the break above the aforementioned downside line drawn from the peak of April 18th and may pave the way towards 87.00, a resistance defined by the inside swing lows of April 23rd and 26th.  Another break, above 87.00 could carry more bullish implications, and could encourage investors to target the 88.95 hurdle, or even the stock’s all-time peak, which is just a cent below the round number of 90.00.

Nike stock daily chart technical analysis


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