Current trend

The shares of The Walt Disney Co., one of the leaders in the entertainment industry, are trading in a corrective trend at 109.40.

Yesterday, analysts at Bernstein Research confirmed the rating of the emitter's shares at the "Outperform" level, raising the target price from 115.0 dollars to 120.0 dollars. Experts believe that the "password exchange" program, which The Walt Disney Co. launched at the end of last year, could bring benefits of 1.2 billion dollars over several quarters, and revenue could increase in the range of 1.0–1.5 billion dollars.

Also positive news for the company was the extension of the contract between the ESPN cable television network and the College Football Playoff tournament, which transfers exclusive broadcast rights for a period of 6 years and a payout amount of 7.8 billion dollars. The current agreement involves deductions of 608.0 million dollars per year, and its increase to 1.3 billion dollars per year is due to the expansion of the league and an increase in the number of games broadcast.

The financial condition of The Walt Disney Co. is quite stable, even taking into account the recent revenue report, which turned out to be below the forecast of 23.75 billion dollars, amounting to 23.5 billion dollars. The positive trend is supported by earnings per share (EPS), which amounted to 1.22 dollars for the first time since February 2020, exceeding expectations of 0.99 dollars.

Support and resistance

On the D1 chart, the asset is trading in a global uptrend, and the price gap between 106.60 and 98.70 increases confidence in the continuation of the upward dynamics.

Technical indicators continue to hold a stable buy signal, despite the local correction: the fast EMAs of the Alligator indicator are kept at a stable distance from the signal line, while the AO histogram is in the buy zone and forms corrective bars.

Support levels: 106.60, 98.70.

Resistance levels: 112.80, 120.00.

Trading tips

In case of continued corrective growth of the asset and price consolidation above the resistance level at 112.80, one may open long positions with the target of 120.00 and stop-loss of 110.00. Implementation time: 7 days and more.

If the corrective decline of the asset continues and the price consolidates below the local support level at 106.60, one can open short positions with the target of 98.70 and stop-loss of 110.00.