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Nintendo (NTDOY) stock buy signal appears on the yearly chart

Patient Nintendo investors could be rewarded in 2020 if the shares can stay above a key level.
Asif Khan
Asif Khan
9

Nintendo shareholders have really been dealt a crap hand for the past few years after the stock had a huge run during the first year of the Nintendo Switch console cycle, but the stock's chart may be giving investors a hint of things to come. Check out this video where I explain the buy signal that just appeared this week on the yearly chart.

Nintendo's stock (NTDOY) spent all of 2019 trading within the price range of 2018. This is an attempt at finding price equilibrium. A breakout above the high or a breakdown below the low of 2019 leads to an actionable signal. This week, NTDOY took out the high of 2019 which is $53.24/share. This is a buy signal and will be valid for the rest of 2020, provided the stock stays above that key level of $53.24/share. If you are a trader, this price should be used as your stop. Patient investors can look to add to the stock above this level, or just nod approvingly as gains roll in. 

NTDOY has triggered an actionable buy signal above $53.24/share on the yearly chart.
NTDOY has triggered an actionable buy signal above $53.24/share on the yearly chart.

Many investors and traders focus on moving averages, fibonacci retracements, and all sorts of other things, but I have found that price equilibrium breaks to be some of the most meaningful signals to pay attention to when looking at stock charts. This is one component of my trading coach Rob Smith's trading strategy called The Strat. Not many people look at yearly charts, but they can be very useful. Time frame continuity, actionable signals, and the concept that stocks trade in a series of broadening formations of trends are the core tenets of The Strat, and folks can follow T3Live and Rob Smith on Twitter to find out more.

Nintendo has been in the news a lot for Switch shortages, but it remains to be seen if the company was supply-constrained during the quarter or if customers were just fiending for something to do during this ongoing COVID-19 pandemic. Investors and traders of the Big N will find out more when the company reports earnings results on May 7, 2020.

Full Disclosure:

At the time of this article, Asif A. Khan, his family members, and his company Virtue LLC had the following positions:

Long Nintendo via NTDOY ADR

CEO/EIC/EIEIO
CEO/EIC/EIEIO

Asif Khan is the CEO, EIC, and majority shareholder of Shacknews. He began his career in video game journalism as a freelancer in 2001 for Tendobox.com. Asif is a CPA and was formerly an investment adviser representative. After much success in his own personal investments, he retired from his day job in financial services and is currently focused on new private investments. His favorite PC game of all time is Duke Nukem 3D, and he is an unapologetic fan of most things Nintendo. Asif first frequented the Shack when it was sCary's Shugashack to find all things Quake. When he is not immersed in investments or gaming he is a purveyor of fine electronic music. Asif also has an irrational love of Cleveland sports.

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