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Too Late to Buy the Cruise Stocks? Let’s Look at Norwegian

Norwegian Cruise Line is looking to get back in the water, but the stock looks less certain. Let's look at the charts.

Norwegian Cruise Line  (NCLH) - Get Norwegian Cruise Line Holdings Ltd. Report has enjoyed strong gains this week, up almost 12% so far between the gains Monday and Tuesday.

The stock has rallied as the company has laid out a plan to start cruising on July 4.

That puts a definitive date on the calendar for the company to get back to business and is certainly a reason for investors to get excited. That's also much earlier than the November date that's being eyed

It helps that Royal Caribbean  (RCL) - Get Royal Caribbean Group Report and Carnival Cruise  (CCL) - Get Carnival Corporation Report were both higher on the day as well.

It’s worth pointing out that Carnival is expected to give investors a business update on Wednesday.

The cruise industry has been a tough investment for obvious reasons over the last several quarters. But as the country continues to make excellent progress on vaccinations the industry has been eager to get back to sailing.

Can the stocks do so as well? Let’s look at the stock of Norwegian Cruise Line.

Trading Norwegian Cruise Line

Daily chart of Norwegian Cruise stock.

Daily chart of Norwegian Cruise stock.

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Norwegian has traded really well between its Fibonacci retracements. First the 38.2% retracement was resistance. Once the stock pushed through, the 50% retracement became resistance.

Sitting in between those two measures now, investors want to know if this stock could still have upside.

Shares are currently above all of the meaningful daily moving averages. That said, the stock is trying to avoid making a third "lower high" since topping out in early March.

From here, let’s see if Norwegian stock can test up into the March high at $34.48. If it can clear $34.50, it not only gives bulls a monthly-up rotation, but it also puts it over the 50% retracement.

That would open up the 61.8% retracement, up near $39.50. Above that and the February gap-fill near $47 is possible.

On the downside, $27 is the key level to keep an eye on. While it would be more constructive to see Norwegian Cruise stock hold up over the 10-day and 21-day moving averages, losing $27 would be a huge negative.

Not only would it put the stock below those two short-term moving averages, but it would also land Norwegian below the 50-day moving average and the 38.2% retracement.

That could put the March low in play near $24.