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Technical Update - Maersk eyeing sub 10K levels. Novo higher but correction looming
Kim Cramer Larsson
Technical Analyst, Saxo Bank
Summary: Maersk is being hit hard after earnings disappointment and can very well re-visit sub 10K levels
Novo moving higher but uptrend stretched and indicators are warning about a short-term correction. Longer-term there could be further upside
A.P. Moller Maersk (B) is down approx. 14% after disappointing earnings announcement trading well below support at around 11,360.
Daily RSI is currently below 40 threshold and if closing below there is further downside potential for the beaten down share. No strong support until around 10,320-9,820.
The rising traded volume is further confirming the downtrend
For Maersk to demolish and reverse this bearish outlook a close of the gap created today i.e., a close above 12,185 is needed.
That scenario is quite unlikely to play out
Novo Nordisk seems unstoppable. However, uptrend is short-term a bit stretched with daily RSI above 80. But there is no divergence indicating Novo could move higher before a correction is hitting.
A move to 839 which is 200% of the latest correction that took place in Q4 2023 – see weekly chart – is likely.
If Novo is closing around current trading levels – or higher – the RSI on the weekly chart has broken its falling trend. There will still be divergence however, but closing above its falling trendline is indicating the divergence could be cancelled. It will require an RSI close above the horizontal dashed line.
Long-term monthly chart Novo has cancelled its RSI divergence by closing January above the dashed line. Currently above 90 RSI is at an extreme (RSI values ranges from 0 to 100) i.e., massively overbought BUT there is no divergence suggesting Novo could continue higher. However, it is ripe for a correction.
There is a warning sign in the form of declining volume. Basically, less and less buyers are pushing the stock higher, that is not sustainable
Support area around 795.70-774.30. A close below could ignite a larger correction down to around 725-700
We’ll keep an eye out for a top and reversal pattern to emerge Author is holding a position in Novo
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