Raymond James sees National Bank of Canada stock weakness ahead

Investing.com - Raymond James identifies a new short-term corrective phase underway for National Bank of Canada (TSE:NA) shares, citing negative price momentum, weakening relative strength versus the TSX Composite, and early signs of institutional selling pressure.

The stock recently moved below the 50-day moving average at approximately $224.18 and appears positioned to test first support near $212.11. A multi-day close below these levels would confirm an intermediate-term corrective phase is taking hold and open the door for a test of support at $210.47, representing 1.9% downside from current levels.

A weekly close below $210.47 would set the stage for a test of the 40-week moving average at approximately $197.28 and major support near $187.92, representing 8.1% and 12.4% downside respectively from current levels. The firm says an inability to stabilize above the 40-week moving average would support reducing exposure.

The stock's relative price momentum versus the S&P/TSX Capped Financials Index is pulling back on the monthly timeframe but improving on the weekly timeframe. This suggests the shares are beginning to improve and attempting to forge an intermediate-term relative price low within a longer-term uptrend.

National Bank of Canada is trading above a volume consolidation zone between $180 and $170, which should provide additional support on any future intermediate-term corrective phases. A breakout above resistance near $222.99 would establish the stock's position as a relative leader within the broader S&P/TSX Financials sector.

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