Possible buy signal forming after inverse head and shoulders?NSIS (Novonesis) has formed an Inverse Head and Shoulders (IHS) formation from August 20 to November 6 this year.
The IHS is a reversal formation.
NSIS broke out of a falling trend on September 30.
The question now is whether we will get a buy signal from a significant breakout above the neckline — i.e., more than 3% with increased volume. We haven’t seen that yet. Such a move would also represent a clear breakout above the resistance at 415.
Price momentum indicators, including RSI 21, are pointing upwards, and the stock has moved above the red cloud in the Ichimoku indicator. In the forward projection, Leading Span A is crossing above Leading Span B.
There was also an almost perfect bullish engulfing signal on November 6.
From a fundamental perspective, analysts are generally positive on NSIS.
NSIS is the result of a merger between Chr. Hansen and Novozymes. In short, they are market leaders in industrial applications of enzymes and bacterial cultures.
Disclaimer: I took a position in NSIS when it broke out of the falling trend, also based on fundamentals and the megatrends that Novonesis is exposed to.
Note: Always do your own research and assessment before buying or selling stocks.
