The Walt Disney Company (NYSE:DIS) – Buy On Dips For A Target Of $75

Denver, CO, 09/13/2013 (Avauncer.com) – The Walt Disney Company (NYSE:DIS) (Closed: $65.49, Up: 2.42%) opened flat and continued to oscillate around the previous day’s closing price until the news of the company planning to buy back its shares to the tune of $6 - $8 billion flashed and the market responded very enthusiastically by taking the stock higher vertically. Late profit booking ate up about a percent of the gains. The price action created a very bullish long range candle. The volume shot up too which at 22 million was more than thrice the average of 7 million.

The stock had a nice run up in the period of 1988 – 1998 when it reached $42.80 from a measly low of $4.50. Then it got stuck in a range with the upper boundary at $44 levels and the lower boundary at $14 - $15 levels for more than a decade. The range was finally broken in 2012 and as happens after this big a range breaks, exploded to the upside to reach $67.89 in 13 months only. The last major rally from the 2011 bottom of $28.19 is a perfectly channeled move, though a steep one showing the immense bullish momentum. At this rally, we have got only two major corrections, both of about 7 – 7.5 points in magnitude. So as long as the lower boundary of the channel remains intact, currently at $60 levels, or we don’t get a bigger correction of about 8 points, the major uptrend remains in force.

The price action from $67.89 took the form of a Flat correction and perfectly contained in a downward channel. On Thursday, the price made its high exactly at the upper boundary of this channel. So for further momentum, the price must cross and sustain above $66.35 - $66.75.

Investors could buy this stock on any dips for targets around $75 in the coming months.