Norwegian Cruise Line Has Set Course for Higher Levels

NCLH has been moving straight up and gapped higher on Friday.

Norwegian Cruise Line Holdings Ltd. (NCLH) has been rallying since the middle of May. Jim Cramer talks about Norwegian along with other cruise and airline stocks on Real Money this morning.

Let's check out the charts and indicators. 

In the daily bar chart of NCLH, below, we can see that the shares were absolutely "crushed" from January to the middle of March. Prices made a quick bounce in late March and then a successful retest of the March nadir in early April. NCLH traded sideways to the middle of May and then it moved to the upside and has made a new high for the move up. The stock is above the now rising 50-day moving average line but still well below the declining 200-day moving average line.

The trading volume has been very heavy since early May and tells me that investor interest has been piling back into NCLH. The daily On-Balance-Volume (OBV) line has been moving up strongly and tells us that buyers of NCLH have been more aggressive.

The Moving Average Convergence Divergence (MACD) oscillator recently crossed above the zero line for an outright go long signal.

 

 

In the weekly bar chart of NCLH, below, we can see that prices are still below the declining 40-week moving average line. No surprise.

 

The trading volume has been very heavy and the OBV line has been soaring to the upside. The MACD oscillator has signaled a cover shorts buy signal. 

 

 

In this first Point and Figure chart of NCLH, below, we used daily price data and here we can see a $33 price target.

Prices could reach that target this week the way prices are shooting higher. 

 

In this second Point and Figure chart of NCLH, below, we use weekly price data, which is projecting a potential longer-term price target of $52.

 

 

 

Bottom-line strategy: NCLH has been moving straight up and gapped higher on Friday. This kind of price action typically attracts fearless traders with deeper pockets -- they do not mind buying high and selling still higher. The problem for mere mortals is the risk. Traders could go long NCLH on any small one or two-day dip and then risk a close below $15 -- the last low on the chart. Our price targets are $33 and $52.

 

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