Let’s check Nike’s charts ahead of Monday’s earnings

In our June 6 exam of Nike (NKE) stock, we wrote, “Continue heeding our May recommendation…” The apparel maker is expected to release its latest quarterly numbers after markets close on Monday, so let’s check the charts again.

In this daily bar chart from NKE, below, we can see that price has tested the $105 area at least three times over the past few weeks. This area is now seen as a base for future gains, in my opinion. Prices are only trading slightly below the falling 50-day moving average.

The On-Balance-Volume (OBV) line shows improvement from mid-May as traders shift from aggressive buying to aggressive selling.

The Moving Average Convergence Divergence Oscillator (MACD) is showing us higher lows from March and is now only slightly below the zero line and a new buy signal.

In this weekly Japanese candlestick chart from NKE below, we can see a number of lower shadows over the past six weeks or so, indicating to us that traders are rejecting the lows.

The weekly OBV line shows some stability while the MACD oscillator is close to a cover shorts buy signal.

In this daily dot-and-digit chart from NKE, below, we can see an upward price target at the $127 area.

In this weekly Point and Figure chart from NKE, below, the software suggests a longer-term target of $164.

Basic strategy: Traders who are still long on NKE could continue to hold these positions. I have no particular knowledge of what NKE might bring to shareholders tonight, but the charts look like they could support further gains and the broad market should rally more as well.

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Darryl A. Chapin