When the Walt Disney Company (DIS) purchased the Star Wars franchise from George Lucas, I remember thinking at the time that the purchase was an awesome one. After all, when you are a media company, it is all about the content. Or to rephrase it, “content is king”. Without the right content, you are destined to fail.

With media companies, the goal is simple. Have as many sets of eyeballs looking at your content as possible. But Walt Disney has other things going for it too, like its theme parks that attract millions of visitors each year.

Disney in Florida is adding a new Star Wars themed section that they are building in their park, sort of like how Universal Studios has a whole section with a Harry Patter theme.

Walt Disney Company (DIS)

This first chart is a 3 year weekly chart for Walt Disney Company (DIS). All trendlines illustrated on this chart are resistance trendlines created by candlesticks. These trendlines are extensions of the resistance areas created by the 3 different bearish reversal candlestick patterns I’ve illustrated on this weekly chart.

Analyzing Bearish Candlestick Patterns on a Weekly Chart That Have Created Resistance Areas for Disney’s Share Price

Here is the trade set-up I see taking place[s2If !current_user_can(access_s2member_level1)]…….

If you want to continue reading this article on the Walt Disney Company (DIS), you must first sign in. If you are not a Trendy Stock Charts member, consider one of the subscription plans.[/s2If][s2If current_user_can(access_s2member_level1)]. The Fibonacci Retracement Tool was placed on the current uptrend that is due for a quick pause at a minimum.

Both the MACD Histogram and overall buying are trending upwards, a nice bullish sign that a new uptrend has definitely started. But I think now that DIS share price has reached its first overhead resistance area, it will pull back in the $96 – $98 range as calculated by the Fibonacci Retracement Tool.

DIS – Moving Averages

This next chart is a 1 year daily candlestick chart to look at Disney’s share price from a moving average perspective. The first thing I noticed is that DIS is awfully close to developing a Golden Cross moving average pattern.

A Golden Cross Moving Average Pattern, a Bullish Signal, Is About to Develop on the Walt Disney Company (DIS) Stock Chart

The best trade opportunity seems to be trimming shares around current prices up to the $107 area and looking to repurchase those shares on a pullback to the 200 Day moving average line. Sometimes there may even be an intra-day break below the 200 Day moving average. This quick break below can offer an even better entry point when trying to scale-in.

Walt Disney Company (DIS) – Summary

The Walt Disney Company just may be getting ready for a new uptrend. If its share price can find support around the 200 Day moving average line, I would consider that at opportunity to start with a small scale-in purchase to go long. That area appears to be in the $96 – $98 area.

Based on the above analysis, I sold 3/4 of my mom’s shares on Friday around the $104 area and will look to purchase them lower. I kept 1/4 so at least I participate on the upside and miss the repurchase lower. Either way, I like to play it a little safer with my mom’s portfolio and lock in the gains when I can.

If the Golden Cross pattern does develop though, I will look to definitely repurchase those shares for my mom in the $96 – $98 area. I would then hang onto these shares for a little while for her, at least until the $105 – $107 overhead resistance is tested again. The more times a resistance area is tested, it is going to crack sooner or later. DIS’s first overhead resistance area looks to be negated soon, possibly over the next month to two month period. I’ll end this article with a nice Disney quote…

“When you wish upon a star”