The last time we looked at the charts of Roku (ROKU) was back on April 21 when we wrote that "Aggressive traders could go long ROKU at current levels risking to $312 for now. Start small and add on strength above $360."
Let's check and see how this recommendation is working out.
(For more on Roku, see here.)
In this daily bar chart of ROKU, below, we can see that ROKU declined to $275 in early May so our long recommendation would have been stopped out with a loss. Prices have improved from early early May and now look ready once again for renewed gains. Prices are trading around the 50-day moving average line and above the rising 200-day line which was successfully tested in early May.
The On-Balance-Volume (OBV) line has been flat/neutral the past three months, while the Moving Average Convergence Divergence (MACD) oscillator looks like it will cross above the zero line soon for an outright buy signal.
In this weekly Japanese candlestick chart of ROKU, below, we can see a large lower shadow in early May as traders rejected the lows below the rising 40-week moving average line. The weekly OBV line has been steady the past five months even as prices declined. The weekly MACD oscillator has been in a decline towards the zero line but the two moving averages that make up this indicator have been narrowing towards a future buy signal.
In this daily Point and Figure chart of ROKU, below, we can see a potential downside price target in the $292 area. A rally and trade at $358.69 or higher should turn the chart more positive.
Bottom line strategy: Traders who are not discouraged by our last buy recommendation could go long ROKU at current levels or on strength above $359. Risk to $299.
