Over the last few days, NKE gapped from $122.50 to $108.02 and appears to have caught strong support dating back to late November. Also, if you pull up a one-year chart, you can see NKE is now over-extended at its lower Bollinger Band (2,20), on RSI, Full Stochastics, and Williams’ %R. From here, with patience, we’d like to see it refill its gap around $122.50.

While NKE slipped on earnings and guidance, it also appears most of the negativity has been priced into the stock. Even Goldman Sachs still says NKE is a buy here.

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In fact, according to the firm, “Margins came in better than anticipated (+170bps compared to the guide of +100bps), while the analyst is also encouraged by NKE’s solid results during the early holiday season, as management highlighted nearly 10% growth and robust results during major holiday moments (Black Friday/Singles Day),” as highlighted by TipRanks.com.

Goldman now has a $135 price target, with a buy rating.

Sincerely,

Ian Cooper