DIS – Disney Co.

Disney Co. (8/25/15) Short-term (Neutral) : Intermediate Term (Neutral) : Long-term (Neutral) One of the top 10 weighted stocks in Consumer Discretionary is Disney, and it has been working contrary to the trend of the sector since peaking in November 2015. We've settled into a range over the past 3 months. It is still in this narrow band, which is neutral for now, with support at 94 and resistance at 101. That resistance has been joined by the 200-day moving average, adding to the significance of that level. As we get squeezed into the apex of a declining trendline and a flat support line, the stock is faced with having to make a move. The predominant trend is down. Therefore, it would take a reversal of magnitude to see a breakout here. Short-term, given a "top-down" approach, it would be difficult to get excited about Disney as we look forward to a pullback phase in the sector. A break below 94 should first attempt to close the opening gap at 91.15. The risk is for a close test of the February low of 86.25. The recent spike in volume was to the upside, which is good. However, this is a pattern that would need to prove itself first, and that would require a close above 101. The next upside move would be to 106.75 and would likely need to extend out a base pattern from that level. DIS