$NEPT 5/30/19: Prove it bulls!
Updated
TraderNoxtreme here with a quick NNEPT analysis per request,
Let's jump right in.
NNEPT had a bearish short term and bullish to bearish mid-term turn.
This being said we have a clear cup and handle formation for our May price action.
MONDAY will be KEY in determining what to expect in June.
BEAR case
- If we get a gap down on Monday the cup and handle pattern would pretty much invalidate (if it hasn't already since we have seen a more significant retrace on the handle). If we gap down, I would expect a test of our previous support at 3.97. If we break 3.97 I would expect we would find support between 3.83 and 3.76. There seems to be a lot of support below that.
- MacD on the daily and 4 hr chart is trying to make a bearish cross. Leaning to bear continuation.
- RSI in a downtrend on the daily, 4hr but still in the 50s (neutral).
Bull case
- We have a tentative break of our short-term downtrend line (handle of our cup). If we stay flat or gap up Monday, I will be looking for the cup and handle confirmation which would swing us back up to 4.70ish. We have a nice green gap up after hrs indicating this could indeed be what happens BUT after-hours trading is very unreliable to take it as a grain of salt.
- We have a solid RSI bounce right off oversold on the 1 hr time frame indicating bulls were just taking a break because we have been forming higher high peaks since march.
- MacD is also curling back up to make a bull cross on the 1 hr and might be rejecting the bear cross on the 4 hour. Weak support of a bull case here but it is weak at best.
- Bullish cross off the 50 and 200 SMA on the 1hr two days ago and also a bull cross of these moving averages on the 1d char back on the 23rd. We also have all the moving averages squeezed together right at our current decision point on the 1 hr. In this case, I think this adds to our case for bulls reversing the short-term trend but under normal circumstances this indicates the move we get will likely be explosive in whatever direction we go.
Conclusion:
If we open Monday flat or gap up, I am expecting continuation up to 4.70 potentially, or higher. 4.70 stand out to me because the uptrend line on our HH peaks meets there nicely. (I do see our 4.37 peak did not touch but it would if I use candle bodies so I am giving it the benefit of the doubt here)
Else
We gap down Monday. It is likely we will retest 3.97 (or open there) and continue down to look for support between 3.83 and 3.76. There is a ton of previous price action for support down here but this stock has a history of setting lower highs and lower lows as it bounces down through previous support levels so depending on your time horizon be cautious if these levels break because we might go through another extended period of consolidation.
I am also leaving out news completely here which is a BIG part to the MJ story (it’s a hype market). Being said, I feel that the charts tells us when news releases will come as it seems they often come right when technicals indicate a shift or a catalyst is needed for continuation/confirmation. Right now seems to be a perfect time for a bullish story to hit and confirm the bull hypothesis.
Please like if you agree, subscribe if you want more, and comment because you can!
Let's jump right in.
NNEPT had a bearish short term and bullish to bearish mid-term turn.
This being said we have a clear cup and handle formation for our May price action.
MONDAY will be KEY in determining what to expect in June.
BEAR case
- If we get a gap down on Monday the cup and handle pattern would pretty much invalidate (if it hasn't already since we have seen a more significant retrace on the handle). If we gap down, I would expect a test of our previous support at 3.97. If we break 3.97 I would expect we would find support between 3.83 and 3.76. There seems to be a lot of support below that.
- MacD on the daily and 4 hr chart is trying to make a bearish cross. Leaning to bear continuation.
- RSI in a downtrend on the daily, 4hr but still in the 50s (neutral).
Bull case
- We have a tentative break of our short-term downtrend line (handle of our cup). If we stay flat or gap up Monday, I will be looking for the cup and handle confirmation which would swing us back up to 4.70ish. We have a nice green gap up after hrs indicating this could indeed be what happens BUT after-hours trading is very unreliable to take it as a grain of salt.
- We have a solid RSI bounce right off oversold on the 1 hr time frame indicating bulls were just taking a break because we have been forming higher high peaks since march.
- MacD is also curling back up to make a bull cross on the 1 hr and might be rejecting the bear cross on the 4 hour. Weak support of a bull case here but it is weak at best.
- Bullish cross off the 50 and 200 SMA on the 1hr two days ago and also a bull cross of these moving averages on the 1d char back on the 23rd. We also have all the moving averages squeezed together right at our current decision point on the 1 hr. In this case, I think this adds to our case for bulls reversing the short-term trend but under normal circumstances this indicates the move we get will likely be explosive in whatever direction we go.
Conclusion:
If we open Monday flat or gap up, I am expecting continuation up to 4.70 potentially, or higher. 4.70 stand out to me because the uptrend line on our HH peaks meets there nicely. (I do see our 4.37 peak did not touch but it would if I use candle bodies so I am giving it the benefit of the doubt here)
Else
We gap down Monday. It is likely we will retest 3.97 (or open there) and continue down to look for support between 3.83 and 3.76. There is a ton of previous price action for support down here but this stock has a history of setting lower highs and lower lows as it bounces down through previous support levels so depending on your time horizon be cautious if these levels break because we might go through another extended period of consolidation.
I am also leaving out news completely here which is a BIG part to the MJ story (it’s a hype market). Being said, I feel that the charts tells us when news releases will come as it seems they often come right when technicals indicate a shift or a catalyst is needed for continuation/confirmation. Right now seems to be a perfect time for a bullish story to hit and confirm the bull hypothesis.
Please like if you agree, subscribe if you want more, and comment because you can!
Note
I guess I was a week early. Dang it.Note
WOW. Nailed this one. Even the news release! didn't take the trade though. FAIL
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