Is The Navigator Stock Lacking Buying Interest? | Technical Analysis
The Navigator Company SA (ELI: NVG), which is one of the four top Portuguese pulp and paper companies in the country, is owned by a Portuguese conglomerate Semapa (ELI: SEM). The Navigator Company managed to battle the pandemic period quite well, as demand for paper remained elevated. That was partially because the food industry, together with packaging and delivery sectors, have been blossoming during the lockdown period. However, the removal of the restrictions allowed other competitor factories to increase their production capacity, which increased the supply in the market.
The technical picture of NVG shows that the stock had reversed lower and is now trading below a short-term tentative downside resistance line taken from the high of May 18th. That said, the share price is currently resting just slightly above a key support area between the 2.748 and 2.766 levels, marked by the low of May 31st and June 21st respectively. Although there is an indication that further declines might be possible, we would prefer to wait for a break of that support area first, before targeting lower zones.
If, eventually, that support area breaks, the share price could drift lower, potentially aiming for the 2.644 obstacle, or even for the 2.538 hurdle, marked by the low of February 12th. Initially, NVG may get a hold-up around there, but if there are still no new buyers in sight, the stock might continue with its journey south, possibly aiming for the 2.388 level, marked by the lowest point of January and the current lowest point of this year.
At the time of writing, the RSI is just slightly pointing south, while sitting below 50. The MACD continues to point lower, while running below zero and its trigger line. The two oscillators seem to support the idea of further declines, as both show increasing downside speed.
Alternatively, if the stock breaks above the aforementioned downside line and then pushes through the 3.014 barrier, marked by the current highest point of June, that may spark interest in the eyes of new buyers. NVG may then travel to the high of May 21st, at 3.130, a break of which could set the stage for a re-visit of the highest point of May and the current highest point of this year, at 3.262.
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