The Roku device allows you to stream free and paid video content on your TV, but shares of the company Roku (ROKU) are what I want to dial into Friday. A sell-side firm raised its fundamental recommendation for the stock to "hold" Friday, so let's check out the charts.
In the daily bar chart of ROKU, below, we can see that the shares have made a long and painful decline from late July. Prices were cut in half and then cut in half again. ROKU is trading below the declining 50-day moving average line and we can see several rally failures to the underside of that indicator. The slope of the 200-day moving average line is also bearish and prices are extended (oversold) when compared to where the indicator intersects.
The On-Balance-Volume (OBV) line shows a decline from late July but also a sideways move from late February suggesting a balance between bulls and bears. The 12-day price momentum study shows higher lows from November as the pace of the decline has slowed down. This is a bullish divergence between the movement of price (down) and the movement of the indicator (up). This divergence, at times, can foreshadow a price rally.