On October 26, 2016, we posted an article about the downside risks associated with Nike (NKE). At the time we said the following:
“The average decline from the previous three periods was –53.23% while the decline from the 2007 peak was –44.13%. If was assume the most conservative decline based on prior secular rising trends then Nike could decline to $38.10. This $38 handle on Nike happens to coincide with the ascending Speed Resistance Lines [SRL] level of $33.52. We’d be buyers of NKE in full force if the stock could decline to the $40 level or below and believe that precedence is on our side.”
On June 7, 2017, we posted our updated thoughts on Nike. Our data suggested that NKE was likely to achieve between +34% to +41% in the following 12-month period. Since that posting, NKE stock price has increased approximately +43.21%.
An additional +40% increase from the current price would bring NKE to approximately $105. From a technical perspective, getting to $105 is quite possible for the following reasons:
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Breakout above the 2015 high
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Breakout above the $69.25, $6.37, & $69.40 triple tops
The potential for another 1-year gain of +40% is possible but would be based a momentum rationale rather than on fundamental reasoning.