NIHD Chart Discussion

Posted by Blain Reinkensmeyer
March 7, 2007 at 10:22 pm

For some technical analysis tonight, I wanted to start with N I I Holdings (NIHD) which has actually held up pretty nicely considering the market’s woes as of late. What you want to take note of is the trading range of the stock, and the very easy to identify support and resistance points:

The red line is the 20 day moving average, and the blue line is the 50 day moving average. When you open the chart you can see very clearly that the 20 DMA is clear resistance here, and the 50 DMA is clear support. So, where do we buy? Should we short?

The answer is to simply wait and see which side gives first. If the stock can break $72 on strong accumulation type volume, it may warrant a buy, especially if the stock closes above the resistance of $72. On the flip side, if the stock trends back down towards $69ish and tumbles below support on strong distribution type volume, it could vary well be a solid short point. As of now though, if you take a look at the MACD which is below the chart, you can see that the black line has been below the red for the last week, yet the stock has stabilized and even tested $72 resistance today. This is a bullish short term indicator.

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