Trade idea of the day: Time to run with Nike?
Fiona Cincotta February 26, 2018 3:14 PM
The broader US equities market is has put in some notable performances over the past week as it attempts to recover from the heavy sell off at the beginning of the month. Friday saw the Dow close 337 points higher, whilst the S&P 500 and the Nasdaq gained 1.6% and 1.7% respectively. Meanwhile today the US markets are pointing to yet another positive start as the markets looks to recover the 10% lost during the second week of February.
The broader US equities market is has put in some notable performances over the past week as it attempts to recover from the heavy sell off at the beginning of the month. Friday saw the Dow close 337 points higher, whilst the S&P 500 and the Nasdaq gained 1.6% and 1.7% respectively.
Meanwhile today the US markets are pointing to yet another positive start as the markets looks to recover the 10% lost during the second week of February. Whilst the broader market is looking to make back those losses, Nike which took a hit when the markets sold off, has already reversed the losses and it back trading at prior highs.
Helping lift Nike has been the implementation of its triple double strategy, whereby it has committed to double its product innovation and manufacturing speed and to strengthen its direct connection to the consumer.
Here we are seeing Nike focus on growth in the e-commerce sector, as evidenced through their recent partnership with Amazon and by their direct selling to consumers through Instagram.
Furthermore, foreign markets like China, have really taken to Nike products and are helping to drive growth in a big way. Looking ahead, the raft of new innovations through triple double strategy could ensure continued popularity abroad which is expected to help lift fundamentals.
Nike is currently trading comfortably above its 10 sma, 20 sma and 50 sma. Furthermore, multiple technical indicators point to a strong buy. Moving time frames out, Nike is in a channel which began back in 1999 and the stock is poised to reach the upper end of the channel which is around $75, this would represent an 11% increase from its current price.
StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.
No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.