Batman and Nike
- Posted by Greg Harmon
- on January 9th, 2013
Ok this is not the same dynamic duo that you grew up with. But Robin vs Nike, which one really makes a better story. Isn’t it a better story line if Batman is with Nike, the Goddess of Victory? What a missed opportunity. I bring this up because those two are working together now, don’t tell Robin, in the chart of Nike, $NKE. Take a look. The Pattern requires a retrace to point B of 50% of the
XA move and this is a little longer but aside from that the BC pullback fits well within the 38.2-88.6% range. The Potential Reversal Zone (PRZ) for Point D is very close between 53.71 and 55.10. What does all this mean? Well a move above 55.10 and then a Terminal Price Bar move back below 53.71 signals a massive reversal with a target of at least 47.77, a 61.8% retracement of the entire range. A continuation above 55.10 negates all this. But look at the supporting cast. As it nears this PRZ the Relative Strength Index (RSI) is starting to level and turn lower with a Moving Average Convergence Divergence indicator (MACD) that is about to cross to negative. These support a move lower is they follow through. And the accumulation/distribution is rolling over as well. Time for caution or at least tightened stops if you are long this stock.
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Gregory W. Harmon CMT, CFA, has traded in the Securities markets since 1986. He has held senior positions including Head of Global Trading, Head of Product Development, Head of Strategy and Director of Equity. (More)
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