Invested Central Chart of the Day 12.31.10

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NKE is a $41.0 billion consumer discretionary company that designs, develops, and markets footwear, apparel, equipment, and accessory products for men, women, and children worldwide. NKE was up 35-40% off its August lows before topping in the near-term in mid-December at slightly above the $92.00 level. The MACD was stretched at the time and its RSI was climbing near 80, generally an unsustainable level. After earnings, NKE quickly tumbled, losing its 20 day EMA and now closing in on its 50 day SMA. The 50 day SMA is currently at $84.91 and price support resides near $84.00. We like entry from the current price down to those two levels. You can keep a fairly tight closing stop just beneath the $84.00 level. $80.00 is very big intermediate-term support if you want to give NKE more room. Top side, we'd keep our target in the $92.00-$92.50 area. With an RSI now back in the mid-40s and stochastics in single digits, we'd look for a turn higher in NKE sooner rather than later.

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