Stock Review: Global Ferronickel Holdings (FNI)

Earlier this week, I’ve seen FNI opened up with a gap up before it meets its uptrend resistance. Its price reached as high as 1.15 which is 130% from its bottom price of 0.50 PHP per share. The decline in its price was caused by extreme negative sentiment caused by the COVID-19 pandemic. Will FNI price continue to move up? Let’s find out.

DISCLAIMER: Feel free to follow our recommendation but trade at your own risk. The information presented here is based on observations and theories. Stock price prediction is not 100% accurate.

FNI Technical Analysis

As of this writing, the closing price of FNI is exactly at 1 PHP per share. I am expecting a sell-off ahead since we just reached overbought condition as seen in the diagram below. Currently, the 20 EMA is acting as support at 0.9095 level. This is a good entry point level for those who haven’t bought it yet. The current resistance is 1.15 which is its most recent higher-high in the trendline. This is 27% gain if you will attempt to enter around 0.91/share.

FNI technical analysis by juanrepublic.ph

Support: 0.9095 (follow the 20 EMA)
Resistance: 1.15 (previous higher-high of the trendline)

Things to Look Out For

The price of FNI stock is heavily dependent on the price of its product Nickel. Having said that, it is very important to track the price of this commodity if you plan to trade FNI. The chart below shows how the price of nickel is moving this year. Notice that its price moves the same way the FNI stock price moves. By tracking the price of nickel, you can set your expectations for target price and stay ahead of the curve it its price is about to go down. According to a poll on Reuters, the median forecast for cash nickel is $15,325 per tonne this year and $16,500 in 2021, up 10%, and 19% respectively on last year’s average price of $13,903.

Nickel Price Chart

Why I like this stock

I like this stock for two main reasons. The first reason is the idea that there is a nickel export ban in Indonesia which allows the Philippines to capitalize well on the market. The export ban will be resulting to a supply crash which will then result into a price increase in nickel and therefore increasing the income FNI. The second reason why I like FNI is because the technical signs is supporting this theory. Notice how FNI price moves the same way as the nickel price. FNI has formed higher-highs and higher-lows resulting in a beautiful trendline with a potential upside of at least 25% if you attempt to buy around 0.91 per share.

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