Let’s check out the charts and the technical indicators to see the stock’s “odds.”
In the daily bar chart of DKNG, below, I can see that the shares have been finding buying interest (support) in the $10 area since May. Since August DKNG made a number of rallies to the underside of the declining 200-day moving average line. The line was finally broken in January and now prices trade above both averages.
Trading volume has been slack the past two to three months but the On-Balance-Volume (OBV) has improved and suggests that buyers of DKNG have become more aggressive than sellers. The Moving Average Convergence Divergence (MACD) moved above the zero line in January for an outright buy signal but now has moved close to a take profits sell signal.
In the weekly Japanese candlestick chart of DKNG, below, I can see an improved chart picture. The shares are trading above the now rising 40-week moving average line.
The weekly OBV line has been going up since May. The MACD oscillator is just below the zero line and just shy of an outright buy signal.
In the daily Point and Figure chart of DKNG, below, I can see an upside price target in the $30 area. A trade of $22 is needed to make a serious upside breakout.
In this weekly Point and Figure chart of DKNG, below, I can see a price target in the $32 area.
Bottom-line strategy: I have no special knowledge of what DKNG will tell shareholders Thursday evening but the charts are in pretty good shape. Traders who can afford to risk to $13 could go long ahead of earnings. The other approach is to wait for strength above $22 before going long. Our price target is $32.
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