These Indications Continue to Support Higher NIHD Stock Prices

NII Holdings stock
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NIHD Stock: Bullish on More Than One Time Frame

The market conditions have been subpar this year, and aside from pointing out that the market has been a difficult one, there have been a number of stocks and sectors making headway. These pockets of strength reinforce the notion that there is always a bull market somewhere.

I am focusing on NII Holdings Inc (NASDAQ:NIHD) stock because this micro-cap stock has been on a tear in recent months. This move toward higher NIHD stock prices has been supported by a number of technical indications.

I want to highlight and outline these indications because as long as they continue to support the NIHD stock price, I will have reason to believe that the current move toward higher NII Holdings stock prices is still in development, and therefore, higher prices will prevail.

The first indication is a technical price pattern, which is highlighted on the following NII Holdings stock chart.

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Chart courtesy of StockCharts.com

This NIHD stock chart has been annotated to capture a technical price pattern known as an ascending channel.

An ascending channel is characterized by price action that contains a series of higher highs and higher lows, which is the quintessential characteristic of a bullish trend.

This pattern was captured by connecting the peaks and troughs that were created by the higher highs and higher lows. This process produced two upward-sloping trend lines that not only define the pattern but also identify where price support and price resistance reside.

These trend lines are very important because as long as NII Holdings stock continues to oscillate between them, I can only assume that this well-defined bullish trend is still in development and that higher stock prices will prevail over time.

In the first week of June, the lower trend line representing price support was tested, and higher NIHD stock prices have since prevailed. I have the inclination to believe that price resistance outlined by this technical price pattern is likely to be tested next.

This notion of higher prices is being reinforced by the price action inside the ascending channel, which has been constructive in nature, and supported by an influential momentum indicator.

These technical indications are highlighted on the following NII Holdings stock chart.

Chart courtesy of StockCharts.com

This NIHD stock chart highlights the constructive price action and the influential momentum indicator that has been responsible for creating and sustaining the bullish trend contained within the ascending channel.

Constructive price action is characterized by two distinct waves: an impulse wave and a consolidation wave.

The waves highlighted in blue are the impulse waves. Impulse waves capture the period in a bullish trend when a stock makes a sustained move toward higher prices.

The waves highlighted in purple are consolidation waves. Consolidation waves capture the period in a bullish trend when a stock corrects and refrains from advancing. Corrective price is very important in the development of a bullish trend because it creates the necessary conditions so an advancing impulse wave can follow.

The impulse waves and consolidation waves have been feeding off each other, creating and sustaining the bullish trend that is currently in development.

These waves have been supported by the moving average convergence/divergence (MACD) indicator.

MACD is an influential momentum indicator that is used to determine whether bullish or bearish momentum is influencing the price action in a stock. Bullish momentum implies that a stock is geared toward higher prices, while bearish momentum implies that a stock is geared toward lower prices.

A stock cannot sustain a move in either direction unless the applicable level of momentum is supporting it. This is why the impulse waves have been supported by a bullish MACD signal and the consolidation waves have been supported by a bearish MACD signal.

On June 11, 2018, a bullish MACD signal was generated, and an impulse wave has been in development ever since. As long as the signal lines that created this MACD signal remain in bullish alignment, I will have the inclination to believe that this wave is still in development and higher NII Holdings stock prices are likely to follow.

Taking a close look at the impulse wave currently in development reveals that it too is constructive in nature, adding further credence to my bullish view.

The constructive nature of this impulse wave is captured on the following NII Holdings stock chart.

Chart courtesy of StockCharts.com

This NIHD stock chart illustrates the constructive nature of the impulse wave currently in development using a one-hour time frame.

The move on June 12 began with an impulse wave, which was followed by a consolidation wave. The consolidation wave was in development for nine days until June 28, when the stock price broke above resistance, completing the consolidation wave.

The completion of this wave implies that a new advancing impulse wave is now in development, supporting the notion that higher NIHD stock prices are likely to follow.

Analyst Take

A number of technical indications that have been supporting the bullish trend in NII Holdings stock continue to suggest that NIHD stock is primed for higher prices. As a result, I will remain bullish on the prospects of this investment as long as these indications continue to support such an outcome.