Looking back at Nike’s first quarter, they had earnings of $1.27 with an estimate of $1.12, so a beat by $.15. The stock actually sold off the following day from poor gross margins, higher SG&A and increased tax rates. If this is a tell-tell sign about increased tax rates there is definitely going to be some concerns over ‘fiscal cliff’ tax increases…something to keep in mind.
How about that chart?
The daily chart is showing no clear direction of trend, but when you look at the Bollinger bands you can see how they are squeezing down and indicating a big move. The 50 and 200 moving averages are also flat and this usually indicates a bigger move in the near future…and what better timing then an earnings report to make that move!
I’m not currently holding NKE and do not plan to going into earnings, but I am looking for a 5%+ move after the bell. Those flatting moving averages and squeezing Bollinger bands are too enticing.
Author: Peter Nitso