Last up this week is Nike (NKE - Get Report) a sports apparel manufacturer that sells its products through 50,000 retail accounts as well as nearly 100 company-owned retail locations. Nike is actually forming a setup similar to General Mills right now -- only this name is further along.
Like GIS, shares of Nike have been locked in an uptrend since the Aug. 8 broad market bottom, and also like GIS, Nike had been approaching a staunch resistance level (in this case at $93). The key difference is the fact that Nike already broke out above that price level.
But a throwback is providing a second chance to take a trade on Nike. A throwback happens when a stock returns to retest newfound support at its breakout level -- the fact that $93 held as a support level for Nike confirms the strength of the stock's breakout. Because the breakout occurred within the channel, we've got a well defined upside target at trend line resistance. Consider buying while shares remain near support, and selling as they approach that resistance level.If you decide to take this trade, I'd suggest keeping a protective stop just under the blue trend line support line. To see these plays in action, check out the Technical Setups for the Week portfolio at Stockpickr. -- Written by Jonas Elmerraji in Baltimore.
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