There are times when the views of fundamental analysts and technical analysts diverge. A sell-side firm cut their recommendation on sports apparel giant Nike ( NKE) to "neutral" but I would argue that the charts are finally poised for a rebound.
Let's check out the charts and indicators.
In this daily bar chart of NKE, below, we can see a long decline from early November to May. A small double bottom (repeat small) can be seen on the chart this month. Prices are below the negatively sloped 50-day moving average line and the bearish 200-day line.
The On-Balance-Volume (OBV) line shows a slide from November and tells us that sellers of NKE have been more aggressive than buyers. The 12-day price momentum study shows equal lows from January to March to May while prices made lower lows. This is a category of bullish divergence. 
In the weekly Japanese candlestick chart of NKE, below, we can see a picture with some near-term promise. Prices are in a downward trend as they trade below the 40-week moving average line. The two most recent weekly candles show lower shadows which tell us that traders are rejecting the lows.
The weekly OBV line is still pointed lower but the 12-week price momentum study shows a slowing in the decline and a small bullish divergence.
In this daily Point and Figure chart of NKE, below, we can see a bearish price target of $105 for NKE and we are really there. Technically oriented traders may be booking profits on their shorts. A trade at $118 may turn the chart bullish.
In this weekly Point and Figure chart of NKE, below, we can see that the shares have reached and exceeded a downside price target of $135.
Bottom-line strategy: Aggressive traders could go long NKE at current levels risking a close below $103. On strength above $118 traders could increase their exposure. I look for a rebound into the $125-$130 area, maybe higher.
