Nokia Plays It By The Book. Look For Old Resistance To Become New Support

By The Wall Street Fox Wednesday, October 1, 2014
Nokia has been making textbook technical moves/indicationsfor more than two years. The stock truly goes by the book, which is an old school move, especially when considering the parabolic price action seen in many broad stocks, spanning from momentum names to blue chip companies. Well rightfully so for the Finnish giant (big fish small pond, or small fish big ocean?), Nokia is 143 years old! It's was an easy call back then, it's an easy call right now.

 Looking to add more Nokia or initiate a position? We'd suggest you wait for a potential test of old resistance around $8.35

Following an upwards breakout, old resistance becomes new support. Looks like Nokia wants to test its old resistance level, near the $8.302-$8.36 level, raise its flag and declare it as new support. We feel fundamentals back up the projection drawn above. As the dollar strengthens against the euro, it is reflected in the stock price, and with the dollar keeping up its pace, it can be a slow bleed for Nokia for the next 1-2 weeks if there is no material news released. At the same time, we feel like a strong earnings report showing revenue improvement from recent contract wins and operating margins in the high range of guidance (looking for 9%+), can provide a significant catalyst for strong price action. Earnings are expected 10/23. We continue to hold Nokia for the long, long, very long term. We are patiently awaiting our 2014 dividend...and 2015...and 2016.
The Wall Street Fox

The Wall Street Fox utilizes fundamental and technical analysis to generate investment ideas. TWSF holds a MBA, and is currently preparing for the Chartered Market Technician (CMT) designation.

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