Technical analysis
Price | € 12,58 | 52 weeks range | € 11.91 - € 19.41 |
Beta | 0,72 | Volume/ average | 87,000 / 2.6m |
Sector | Technology | Dividend | N/A |
Nexi is a payment service provider offering merchant buying, card issuing and digital banking services across Europe.
From its listing in April 2019, we can see four price ranges with major points of contact: € 8.50 - 12.00 / € 13.00 - 16.00 / € 16.00 - 18.00 / € 18.00 - 19.00.
Instead, we consider the intermediate range of € 12.00 - 13.00 as a consolidation area where the stock has in the past continued the short-term trend or reversed upwards as in November 2020.
To understand the NEXI price fluctuation, we use the Volume profile and Fibonacci retracement
Volume Profile (POC € 14.80): we can see how the stock is now in a very important area as a downward overshoot could lead the stock to quickly reach the € 10.50 - 9.50 area view the almost absence of volumes between these two areas. Conversely, a recovery in the price could lead the stock to gain ground and reverse the short to medium term bearish trend.
Fibonacci Retracement: Thanks to the retracement lines, we can see how the stock is now at the 61.8% level. In our opinion, the most important level that can mark the difference between a bearish continuation or a bullish reversal.
Indicators
Looking at the MACD and RSI indicators: both show a positive divergence with the price fluctuation, from November 2021 at a continuously falling price we are seeing increasing lows in both indicators.
On the weekly chart we can instead see a very extended downward MACD, but close to a possible bullish cross, and a flat RSI despite a falling price.
Moving averages
Given the recent price, we take into consideration the 9 and 50 day averages in order to identify trend changes.
We believe the 9-day average can be useful to understand the beginning of a possible trend change as happened in November 2019, April and November 2020 and April 2021.
The 50-day average has been playing the role of moving resistance since August 2021, therefore we believe that a possible buying position should only be considered with a price above the latter.
Conclusions
We believe that NEXI is now at an important watershed that could lead the stock to reverse up or drop quickly to € 10.50 - 9.50.
The positive divergence of MACD and RSI with the price coupled with what we believe to be a slowdown in bearish force, makes us think of a trend reversal in the short to medium term.
To confirm this reversal, we believe that the price must first consolidate above the 50-day average: then we see as a price target or possible increase in the “long” position € 16.00 and € 18.00.
At the moment, the stock seems close to exceeding the 9-day average, which could signal the beginning of a change in trend.
In the event that the price drops to € 10.50 - 9.50, we will evaluate the possible purchase of a heavily extended stock on the downside and most likely in oversold conditions.
Entry range € 13.50 - € 14.00
Target 1 € 16.00
Target 2 € 18.00
Stop loss € 11.50
Graphs
OTB Global Investments
24 February 2022
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