Boston, MA 09/19/2014 (wallstreetpr) – Nokia Corporation (ADR) (NYSE:NOK) (Closed: 8.63 Up: 1.05%) has been going up for the last 5 weeks and the recent upgrade by the broking house of Oppenheimer for a target of $12. The rally from the August low of $7.60 looks impressive at first, but the recent loss of bullish momentum can’t be missed and warrants more attention from the investors.
On 3rd September, the stock had hit a high of $8.49 and on 18th September, hit the high point of this month so far in $8.68. That translates into a gain of about 2.2% in 11 trading sessions, definitely unimpressive. It would be much less alarming if it was a sideways consolidation instead of the Rising Wedge it has formed, a pattern with bearish implications in the short term at least and most probably, in the medium term too.
If we take a larger perspective, it will be seen that the current 2014 high of $8.68, registered yesterday, is just about 6% higher than the January 2014 high of $8.20. Not impressive in the backdrop of the huge bull market running in the broader market. Since last February, the price has been mostly contained in a big channel, slanted upwards. Currently, the price is very close to the upper end of the range at $8.76-$8.80 and a failure to break above that on an immediate basis may well turn out to be the end of the rally as there is no more room for the Rising Wedge pattern to continue. The breaking point is reached and a resolution would be seen within the next 1-3 sessions.
Among the indicators, the RSI is showing no signs of breaking above the resistance level of 70 and MACD is showing multiple negative divergences with the price, suggesting a lot of hidden weakness in the price. Investors could do well to book at least partial profit at the current levels.
