The Walt Disney Co. (DIS) was reviewed a month ago. At that time I wrote, "DIS fans have three charts to consider. In the short run DIS could correct to the downside. Longer term, DIS could stage a major move up from here. Maybe a trade above $120 will do it. Stay tuned." DIS made a run at $120 in October and we could be set up for another test in the days ahead. Let's review the charts and indicators again for Disney, which is a holding of Jim Cramer's Action Alerts PLUS charitable trust.
In this updated daily bar chart of DIS, below, we can see that prices are above the rising 50-day moving average line and the bullish 200-day line. The daily On-Balance-Volume (OBV) line is poised to make a new high for the move up ahead of prices making a new high. It is not unusual to see volume lead price. The trend-following Moving Average Convergence Divergence (MACD) oscillator has stayed above the zero line since late September when the price trend of DIS turned sideways. Now the MACD oscillator is poised to turn to the upside for a fresh outright go-long signal.
In this weekly bar chart of DIS, below, we went back to late 2014 to show the resistance around $120. A breakout over $120 clearly will be bullish. DIS is above the rising 40-week moving average line. The weekly OBV line has been saw-toothing higher the past few months and the weekly MACD oscillator is bullish.
In this Point and Figure chart of DIS, below, we can see an upside price target of $134.97, but a trade at $120.05 is needed for a breakout.
Bottom line strategy: DIS is poised to break out any day now. Go long above $120 and risk below $114 for traders and below $111 for investors. The first upside price target is $135.