Earnings Play: Nielsen Holdings

Look for resistance at the upper trendline of the descending broadening wedge pattern.

Downtrend 5

On Friday, Nielsen Holdings (NLSN) is anticipated to report third quarter EPS of $0.39 compared to $0.51 a year ago on revenue of approximately $1.5 billion vs. $1.6 billion last year. Nielsen operates as a marketing services company and its current analyst consensus rating is 9 buys, 6 holds and 3 sells, according to Bloomberg.

Looking at a daily chart, Nielsen's stock price appears to be falling within a descending broadening wedge pattern that began to form in early-August. The RSI also peaked in early-August and has been falling since. The simple moving averages (SMA) are positioned in a bearish manner with the 20-day SMA below the 50-day SMA and the 50-day SMA below the 200-day SMA. Price will likely continue to advance to the upper trendline of the pattern where it will likely find resistance and stop rising. If price is stopped at the upper trendline it will probably sell off to the 13.30 support level. If price breaks out below 13.30, then is could drop all the way down to 11.80. On the other hand, if price breaks out above the upper trendline traders should look to 15.90 as the first target. If price can get above 15.90, it could potentially reach for the pattern peak of 16.70.          

Source: GAIN Capital, TradingView

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