Benzinga - Walt Disney Co (NYSE: NYSE:DIS) gapped up about 9% on Monday after the company announced it had replaced CEO Bob Chapek with its former veteran CEO Robert Iger, who left the company after 15 years in 2021.
Traders and investors are hopeful the change in management could provide the company new opportunities, with advancements into Web3, improved relations with theme park goers and that Iger may be able to hit the reset button with Florida Governor Ron DeSantis.
The news was well received, at least initially, causing Disney to confirm a new uptrend pattern was in the works. An uptrend occurs when a stock consistently makes a series of higher highs and higher lows on the chart.
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The higher highs indicate the bulls are in control while the intermittent higher lows indicate consolidation periods.
The Disney Chart: Disney’s most recent higher low within the uptrend was printed on Thursday at $90.85 and the first higher high was created at the high-of-day on Monday. The stock opened the session on top of the 50-day simple moving average and popped up to hit resistance at $100.90 before rejecting and starting to decline intraday.
- On the decline, Disney tested support at the 21-day exponential moving average and was attempting to hold above the area. The stock may need to retrace to close the lower gap between $93.16 and $97.02 before continuing higher, if the bulls remain in control.
- The recent reversal to the upside took place after a bearish breakdown from a bear flag pattern occurred on Nov. 9, the day following Disney’s earnings print. On Nov. 8, Benzinga pointed out a bearish reaction was the most likely scenario and the stock completed the full measured move, which indicated a bounce was likely on the horizon.
- If Disney closes the trading day near its low-of-day price, a further retracement is likely in the cards for Tuesday. If the stock can bounce to close the trading session with a significant lower wick, either higher prices or an inside bar could be in the cards.
- Disney has resistance above at $100.90 and $108.50 and support below at $92.71 and $85.76.
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