Things Are Getting Ugly With Naked Brand Stock

Naked Brand Group Ltd NAKD shares are trading lower Tuesday as the stock falls below a key support level. The company recently entered into a definitive merger agreement with Cenntro Automotive, an EV technology company that has produced and shipped 628 newly launched model Logistar 200 vehicles.

Naked Brand closed down 8.91% at $5.01 at market close Tuesday.

See Related: What The Future May Hold For Naked Brand After Reverse Split: Technical Analysis

Naked Brand Daily Chart Analysis

• The stock looks to have fallen below support in what traders call a sideways channel. The adjusted prices from the recent reverse split have the stock showing key levels at the $7 and $11.50 prices. Both of these areas may now hold as resistance as the price is trading below them.
• The stock trades below both the 50-day moving average (green) and the 200-day moving average (blue). This indicates bearish sentiment and each of these moving averages may hold as an area of resistance in the future.
• The Relative Strength Index (RSI) continues to fall and sits at 19, well into the oversold region. This shows that sellers are dominating the market and that the selling pressure heavily outweighs the buying pressure.

What’s Next For Naked Brand?

Naked Brands is continuing its free-fall following the reverse split. The stock is well below the $7 level shows where the stock has held as support in the past adjusted for the reverse split. Bulls are looking to see the stock bounce and start to turn around by forming higher lows. Bulls are then looking for the price to cross back above the $7 level and be able to hold above it. Bears are in control of the stock as it sits and are looking to see the stock continue to fall and hold below both of the moving averages and the $7 level.

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