Nike is currently descending rapidly, forming a huge red weekly candle on the beginning of July, creating a -22% drop. While this collapse has been bloody, it’s also an opportunity for investors and traders alike to settle into a buy position.

To get a clear picture of our key levels, let’s zoom out to the 1W chart on Nike.

Technical Analysis of NKE (July 17th, 2024)

As you can see, the NKE stock price has broken a weekly rising trendline and was rejected from a retest at $97.30, forming a large weekly red candle.

However, it’s important to note that Nike has now entered the oversold territory on the weekly RSI. This doesn’t necessarily mean you should immediately enter a buy position, especially with a leveraged CFD trade, but it does create favorable conditions for considering a swing long.

As Baron Rothschild famously said, “The time to buy is when there’s blood in the streets.”

We should focus on three key points of consolidation for potential buy opportunities:

1. The consolidation range between $64.00 – $69.00. 

2. The point of control (highest volume node) at $55.39, formed since 2015. 

3. The range low from 2015 – 2018 at approximately $50.00 – $52.00.

The first area, $64.00 – $69.00, is arguably the least significant but served as a launching point in 2020 during Covid, leading to a parabolic run in Nike’s price.

The second area, $55.39, is the most critical. This Point of Control represents the price level with the highest trading volume since 2015.

Finally, if the Nike stock price revisits $50 – $52, remember that this level was a reliable support area for four years between 2015 and 2018. Given that the Federal Reserve is considering a rate cut, it is unlikely that the price would fall below this level.

You may also be interested in:

Triangles Trade Opportunities with Dovish Fed Speech