How Does Activision Blizzard Look Before Earnings?

Let's check on the stock again.

With Activision Blizzard Inc. (ATVI) set to report its latest earnings on Tuesday, let's see how the stock is setting up going into the print.

When we last reviewed ATVI on June 9 we wrote that, "Traders who went long ATVI in late April should continue to hold those positions. Traders who are flat could purchase ATVI here. Raise stop protection to $90 now. $106 and $119 are our price targets for now." Traders should have been stopped out in July so let's check on things again.

In the updated daily bar chart of ATVI, below, we can see that the shares have broken down from what now looks like a large top formation with a neckline across the $85 to $90 area (allowing for a slight upward bias). Prices are below the declining 50-day moving average line and the cresting 200-day moving average line.

The daily On-Balance-Volume (OBV) line made a new low in July and now the downtrend from April has been extended. The trend-following Moving Average Convergence Divergence (MACD) oscillator is below the zero line in sell territory.

 

In the weekly Japanese candlestick chart of ATVI, below, we can see a large red candle (bearish) has broken below the rising 40-week moving average line.

 

The weekly OBV line is now pointing down. The MACD oscillator has weakened and is close to the zero line telling us that the "trend strength" is weak.

 

 

In this daily Point and Figure chart of ATVI, below, we can see that prices are pointed down.

 

 

In this weekly Point and Figure chart, below, we can see a $70 price target.

 

 

Bottom-line strategy: Traders should have been stopped out and are on the sidelines. Continue to avoid the long side of ATVI until clear signs that a new bottom has been formed.

 

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