Account
New to ADSS? Open an
account now to get started.
Already have an account?
Add funds to your ADSS account
Account
New to ADSS? Open an
account now to get started.
Add funds to your ADSS account
Asset Watch
Thursday, August 15, 2024
The financial markets were back in rally mode on August 13, after confidence returned following last week’s flash crash. And while volatility may persist as politics and central bank uncertainty dominate the news cycle, Nike has already suffered investors’ wrath.
The stock sank by more than 20% after the company reported weak fourth-quarter results in June and analysts cut their price targets. But, with the Olympics providing a nice sentiment bump, could a comeback be on the horizon?
Maintaining their outperform rating and price target of $112, Bernstein SocGen Group analysts noted on August 13 that Nike’s brand performance has improved alongside higher average selling prices (ASPs), reduced markdowns, growing search interest, and positive retailer feedback. Its Direct to Consumer (DTC) channel has also progressed as new launches pique shoppers’ interest.
Nike was stuck in a range for the last several weeks, with the stock price largely fluctuating between $71 and $75. Attempts to break above the $75 area (the horizontal white line) were rejected, and Nike struggled to maintain positive momentum. Although, the tide may have turned on August 13.
Amid the market optimism and positive comments from analysts, Nike burst through the $75 area and has support from its 5-week moving average (the blue line). However, it’s right up against resistance from the 10-week MA (the yellow line), which makes the $79 area a key confirmation zone.
To avoid enduring a false breakout, the best approach is to wait for a confirmed close above the 10-week MA. If Nike reclaims its 10-week MA and has support from the $75 area and the 5-week MA, the powerful combination could tilt the risk-reward in your favour.
ADSS
8th floor, CI Tower
Corniche Road
PO Box 93894
Abu Dhabi
United Arab Emirates
Trading Services
ts@adss.com
+971 2 657 2414
Investing in CFDs involves a high degree of risk that you will lose your money due to the use of leverage, particularly in fast moving markets, where a relatively small movement in the price can lead to a proportionately larger movement in the value of your investment. This can result in loses that exceed the funds in your account. You should consider whether you understand how CFDs work and you should seek independent advice if necessary.
ADS Securities LLC – S.P.C (“ADSS”) is authorised and regulated by the Securities and Commodities Authority (“SCA”) in the United Arab Emirates under First Category: Dealing in Securities and Fifth category: Arrangement and advice (Introduction). ADSS is a Limited Liability Company – Sole Proprietorship Company incorporated under United Arab Emirates law. The company is registered with the Department of Economic Development of Abu Dhabi (No. 1190047) and has its principal place of business at 8th Floor, CI Tower, Corniche Road, P.O. Box 93894, Abu Dhabi, United Arab Emirates.
The information presented is not directed at residents of any particular country outside the United Arab Emirates and is not intended for distribution to, or use by, any person in any country where the distribution or use is contrary to local law or regulation.
ADSS is an execution only service provider and does not provide advice. ADSS may publish general market commentary from time to time. Where it does, the material published does not constitute advice, or a solicitation, or a recommendation to a transaction in any financial instrument. ADSS accepts no responsibility for any use of the content presented and any consequences of that use. No representation or warranty is given as to the completeness of this information. Anyone acting on the information provided does so at their own risk.
