By Tyler Prahm (University of Nevada, Reno), Joshua Palabay (University of Nevada, Reno), and Marin Hubert (McGill University)
Stock Name: Nano Dimension
Ticker: NASDAQ: NNDM
Timeline: 3 to 4 weeks
Nano Dimension Ltd. is an Israel-based additive electronics provider active in the technology sector. With its 3D printing technology for printed electronics, the Company targets the growing demand for electronic devices that require sophisticated features and rely on encapsulated sensors, antennas and printed circuit boards (PCBs). The Company's PCB Jet printer system is an inkjet deposition tool for printing multi-layer circuit boards at home or office. It uses hardware, software, print-head management and nano-chemistry for Research and Development (R&D), prototyping and custom manufacturing projects. The Company targets a range of industry sectors, such as consumer electronics, medical devices and defense, aerospace, automotive, Internet of Things (IoT) and telecom.
The company was founded in 2012 and is headquartered in Ness Ziona, Israel and their primary customer-base is in the United States. Its flagship product is the proprietary DragonFly lights-out digital manufacturing (LDM) system, a precision system that produces professional multilayer circuit-boards, radio frequency antennas, sensors, conductive geometries, and molded connected devices for prototyping through custom additive manufacturing.
Product Offerings Snapshot
As we mentioned before, Nano Dimension’s main product line is a multi-layer 3D printer. Their latest and most popular product is the Dragonfly LDM Precision Additive Manufacturing for Electronics. This one is used by many companies worldwide in need of agile hardware development and innovative circuit design. It allows companies to manufacture Printed Circuit Boards and other electronics in-house. As a result, this product has many applications in diverse markets ranging from aerospace and defense to healthcare. Further, $NNDM offers to its customers a Lights-Out Digital Manufacturing (LDM) technology. This innovative technology enables systems, such as the DragonFly system, to run with little to no intervention, around the clock. In other words, this system allows clients who previously purchased the DragonFly 3D printer to print hardware 24/7. When a customer buys the DragonFly system, he can also expect to have access to the Switch software provided by Nano Dimension.
Sector and Industry Overview
ETF: ARK Autonomous Technology & Robotics ETF (ARKQ) Weightage in ETF: 2.09%
Index Comparison Analysis
Graph 1: Nano Dimension compared to ARK Autonomous Technology & Robotics ETF (Tradingview.com as of March 21, 2021)
Comparing Nano Dimension ($NNDM) to the ARK Autonomous Technology & Robotics ETF ($ARKQ), there is a direct historical comparison between both securities. $ARKQ, in this scenario, is referred to the index of $NNDM because of $NNDM’s high weightage of 2.09% within the ETF out of any other ETFs $NNDM falls under. Historically dating back to October, 2020, $NNDM and $ARKQ correlate with one another almost identically. Given the correlation, $NNDM is very responsive to underlying price movements in $ARKQ.
Moving Averages Analysis
Graph 2: ARK Autonomous Technology & Robotics ETF with simple moving averages (Tradingview.com as of March 21, 2021)
From the start of November to mid February, $ARKQ traded in an uptrend with the stock price above its 50dMA (labeled in yellow). However, due to the strong correction that impacted the entire tech sector in mid february, the stock broke that support line and decreased further down the days that followed. We could then identify the start of a downtrend with the shorter term moving averages (10dMA and 25dMA) crossing the 50dMA. $ARKQ bottomed out in the beginning of March and saw a rebound in the price since then. Recently, we observed a bullish crossover between the 10dMA (labeled in dark blue) and the 25dMA (labeled in light blue), sign of reversal of the trend. The stock is currently taking support on the 25dMA and the 50dMA acts as a strong future resistance. $ARKQ will most probably experience a period of consolidation between these levels until we see a clear crossover.
Support and Resistance Analysis
Graph 3: ARK Autonomous Technology & Robotics ETF with recent support and resistance levels (TD Ameritrade Thinkorswim Platform as of March 21, 2021)
When looking at Graph 3, the past month posts an overall uptrend on $ARKQ. As of late, consolidation has occurred with $84.00 acting as a support level and with resistance at the $90.00 price level. $ARKQ at the time of this writing is at the $84.00 support level and looks to be holding really well. Currently, the price of $ARKQ is sitting at $84.68, and looks to have a lot of upward room towards its all-time high of $101.11. As the ETF is currently below its all-time high, there is a lot of room for it to go up and we will see this when the price breaks above the $90.00 resistance level.
Trend and Pattern Analysis
Graph 4: ARK Autonomous Technology & Robotics ETF with regression channel (Tradingview.com as of March 21, 2021)
Before the breakout that occurred in the midst of February, $ARKQ was trending in a clear uptrend channel since November 2020. As a matter of fact, the regression channel indicates that nearly 98.3% of the candlesticks observed from November to mid February fall in that channel. Although the price broke out of that channel during several days at the end of 2021 before coming back, we can assume the lower and upper bands of that channel to be strong levels of support and resistance for $ARKQ. Now that the price has broken out and is trading below that channel, investors should worry about the lower bound acting as a strong resistance level. In the midst of february, the break in the regression channel should have been interpreted as a strong signal of upcoming reversal in the trend.
RSI and Stochastic Analysis
Graph 5: ARK Autonomous Technology & Robotics ETF with RSI and Stochastic analysis (Tradingview.com as of March 21, 2021)
Given the rapid historical uptrend of $ARKQ on the 4h chart, $ARKQ continued to create new highs.Within these new highs, the RSI formed a bearish divergence, as indicated with the downward support trend (highlighted in black). Considering the oversold levels of the RSI, $ARKQ may bounce upwards and reverse a trend to reach overbought levels on the RSI. However, the Stochastic RSI states otherwise. On the Stochastic RSI, the oscillator and the 3d moving averages appear to be on a steep downtrend. The steep downtrend still has room to become oversold. If it becomes oversold, it may show signs of a reversal if an uptrend occurs on the Stochastic RSI.
Technical Outlook for the Stock
Support and Resistance Analysis
Graph 6: Nano Dimension with recent support and resistance levels (TD Ameritrade Thinkorswim Platform as of March 21, 2021)
Utilizing a 6-month timeframe for $NNDM, we conducted our support and resistance analysis for the stock. The significant price levels that we used to perform this analysis are the $6.00, $7.60, $10.00, $11.50, and the $17.89 price levels. As of late, we can see that $NNDM’s current stock price is ranging between the $10.00 support level and the $11.50 resistance level. The price is currently above the $10.00 support level and for an upward momentum buy signal, we would look for a break above the $11.50 resistance level. In terms of support levels, we can see that the $6.00 and $7.60 price levels are very significant as $NNDM’s stock price has bounced and reacted heavily at these price levels. At the time of this writing, the immediate resistance level that investors will have to pay attention to is the $11.50 price level for $NNDM.
Graph 7: Nano Dimension with Fibonacci levels (Tradingview.com as of March 21, 2021)
In regard to short-term Fibonacci levels on the 1M1h chart, $NNDM holds key support levels around the 0.382 Fib level. With a break of the 0.382 Fib level, $NNDM could break down to the gap of the 0.786 Fib level. If $NNDM fills the gap, it may find new support. On the contrary, if $NNDM bounces upwards, and breaks above the 0.236 Fib level, it might find new levels of support around the $10.40 mark.
Trend and Pattern Analysis
Graph 8: Nano Dimension with trend and pattern analysis (Tradingview.com as of March 21, 2021)
For the last 6-month period, $NNDM has taken support several times on its bullish long term trend outlined in Graph 8 by the blue line. After breaking below this trend in mid-February, we can see that the stock price tried to cross above, which would have been a strong signal of continuation in the long term trend, but got rejected. Going forward, this trend will act as a strong level of resistance for $NNDM. Furthermore, the correction that we got rejected pretty quickly around the 15th of March started a descending triangle pattern for the stock. In a bullish trend, this pattern is seen as a strong continuation pattern, meaning that this is an indicator that a breakout will occur and $NNDM will potentially retest its long term trend.
Graph 9: Nano Dimension forecasted price change (Toggle.ai as of March 21, 2021)
Toggle calculates the price movement of recent trends and proposes a forecast for future trends relevant to historical trends in the past. For this specific analysis, Toggle analyzed the previous four months of price movement to represent recent volatility and price action. Taking the price action into account, Toggle’s analysis forecasts the next 6 months of price movement. Within the 6 month forecast, $NNDM is expected to move to $30 a share. A jump to $30 a share would mean a 294% jump in share price. Given the recent downside movement, $NNDM may take a lot of time to recover. A long-term recovery may result in a steady increase in share price, graphed in Toggle’s forecast.
Moving Average Analysis
Graph 10: Nano Dimension with long-term moving averages (TD Ameritrade Thinkorswim Platform as of March 21, 2021)
Utilizing a 6-month timeframe for $NNDM, we conducted our long-term exponential moving average analysis. The long-term exponential moving averages that we used to perform this analysis are the 50EMA (yellow), 100EMA (orange), and 200EMA (red). In recent months, the price action of $NNDM has been above all three of these long-term exponential moving averages which indicates bullish momentum in the stock. However, on February 23, 2021, the $NNDM’s stock price crossed and closed below the 50EMA indicating signs of buying pressure weakness as the price was not able to close above the 50EMA. From this moment on, the price was rejected at the 50EMA level and continued to fal