One Step Closer To A Fall From The Skies For Walt Disney Co.

One Step Closer To A Fall From The Skies For Walt Disney Co

Remember our analysis 3 Stocks you Should keep an Eye on? Well, the price of Walt Disney shares have dropped from 68$. After a consolidation in a symmetrical triangle, the pressure started to turn on the down side. The lower line of the triangle couldn’t stop the fall of the price and now it is found at a key support, 61.69$.

DIS Daily Chart

Chart: DIS, Daily

The price pattern is looking now as a Double Top. A daily close under the base line of the pattern would confirm a breakout and might trigger a fall of almost 10 percent. The target of the price pattern is the projection of the height of the Double Bottom from the base line. The price target is 56.00$, but it could get even lower touching 53.38$ per share, which is an important support level, tested in September 2012 and February 2013.

This fall is also signaled by the big divergence drawn on the 28 days RSI, but it is dangerous to sell short the stocks right at this moment. Waiting for a close under 61.70 would be the smartest thing to do. Having the confirmation investors could sell short the stock with their broker, speculate on CFDs or even buy a put option with 3 months ahead strike price.

 

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes:

<a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>