NUF is an agricultural services company and one of my personal rules is to generally avoid any stock whose fortunes are weather dependent – such as cropping. Nevertheless, it has broken downtrends in January and again in August. The first break saw significant subsequent falls that would have rendered any trade breakeven at best. Could it be going to repeat this action?

On a more optimistic view of NUF, price has retested a line of support (blue dashed line on chart) that has held over the past year. If price can rise and break above $5.50 it could go to $7.00 – which would make it a very nice trade.

NUF made a text book Elliott Wave price cycle over the past 10 years except for the recent significant low last November. It is unclear if that low was actually the end of a Wave 1 and 2 which fell below its start of W1 (the Nov 2020 low) – something EW theory says shouldn’t (but not can’t) happen. This unusual pattern is a mirror of what happened at the end of the last cycle back in 2011 so I’m assuming from how 2011 panned out that EW theory holds and the Nov 2020 low is the end of a Wave C  (ie not the end of a rogue Wave 1). As such I suspect price is currently rising on Wave 1 and the potential $7.00 target could be the top of Wave 1.

NUF 3Dec21


Robert Norman

Phone: 0428 346 951

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