Novo Nordisk: Technical Setup Improves Ahead of Earnings
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European Software Companies Are Set to Make a Comeback
European stock markets are currently outperforming their U.S. counterparts, and thanks to the gains of the past few days, our screenings have identified a number of interesting stocks. Among these, we have highlighted stocks that have recently shown signs of a structural turnaround, while strengthening buying pressure is also supporting the positive technical picture. One such company is Germany’s Nemetschek, a leading provider of construction and architectural design software. The other is the Dutch firm Wolters Kluwer, which offers professional information, software, and specialized database solutions. For both stocks, the search for long entry opportunities may have begun.
European stock markets are also seeing more and more opportunities, but the best potential returns relative to risk are largely to be found in underperforming stocks. Novo Nordisk, one of our stocks from the Equity Top Pick list, is showing positive signs of a long-term trend reversal. Tomorrow’s earnings report could mark a decisive turning point if it goes well.
Best rated European stocks based on momentum ranking
Compelling technical picture:
Novo Nordisk (daily): There are signs of a shift in the long-term downtrend. Over the past few months, the 281 level has provided support from below. After breaking through this level, the price did not continue to fall but instead entered a consolidation phase. Tomorrow could be a very important day, as quarterly earnings are due. If the price reaction can push it back above 281, the stock may be able to form a reversal pattern. In that case, the path toward 343 or 375 could open up.
List of stocks with a chance of a turnaround in the coming weeks
Most popular European stocks
The momentum model supports the creation of a technical based stock list that helps to find shorter-term trading opportunities. The model can be used to identify stocks that show reversal signals following more sustained falls/underperformance. We examine one-year, six-month, three-month, one-month and five-day momentum values, which are used to rank the stocks under consideration. The higher a stock is ranked in the order, the better it technically performs relative to the others. The change in the ranking over time is used to determine the life cycle of the stock.
- In the first table, we collect the stocks that show the most attractive picture compared to the others in a given week based on momentum factors, of which those are also presented in a separate chart where a favourable situation can be identified based on additional technical analysis tools.
- In the second table, we list the stocks that are already worthy of being placed in watchlist status. They are not among the best performers, but they have the potential to improve and signal a turnaround in a few days or weeks.
- In the third table, we have also collected the more popular stocks to help identify their position in the momentum order.
The report shows the results of a technical - quantitative based stock screening, which does not examine the fundamental background/value of the companies. For this reason, risk management/position sizing rules should be designed accordingly.
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