Short term bearish; If channel continues to hold, buy.

This should re-test the mid-18s in the next week or two. If it holds again on a re-test, I'd suggest waiting until a high over $22.30 and then buy. It should head for $26-28 at that point to re-test the ATH.

Disclaimer: I hold no position in NLS.

Note

It's been a week since I posted this. The wedge has tightened and I'm seeing a hidden bullish divergence on the stochastic. I'm still keeping an eye on a close above $22.30, but this is looking pretty bullish right now. A word of caution though, there was significant Put option activity at the end of the week. In my opinion though, once the volume picks up, we're looking at a $28 stock. Especially with this leading up to earnings in late February, which will likely be a strong report for the company. If this stock even received a fraction of the Peloton multiple premium, it'd at least double.

Note

This worked out in a textbook way so far. With that in mind, if this keeps the trend, we should see the first resistance at $33.97 with the second resistance at $44.96. Right now is likely a good entry point with some profit taking at that first price target of $33.97 and keeping the ultimate price target of $44.96 ready for your second profit taking.

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