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Trade of the Week

April 16, 2024
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Josh Viljoen
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Josh Viljoen

USD large cap stock coming into attractive levels

My trading pick for this week is none another media and entertainment giant Disney (NYSE:DIS). The stock has been severely beaten down over the past two years since March 2021 and I suspect this presents an attractive entry for a long term swing trade.

 

The stock has drifted back down towards the COVID-19 lows and and the lows of December 2022 around the 80 to 85 dollar mark. The share currently trades at $87 dollars a share and at a key level of long-term support.

 

I think the current price presents a good risk to reward ratio. Should you wish to time your entry I would look to enter if the stock pushes down further to $85. Entering at current levels with a stop loss around $77 and targeting the March 2021 highs of $200 offers a nice risk to reward of 1 to 11, which I think is asymmetric upside for the level of risk. 

 

The potential gain on should the price hit $200 again from current levels of 130% for an unleveraged position. This trade however could take a while to play out and will require patience. 

 

This should not be considered financial advice and all investments and trades are inherently risky and have no guaranteed returns.

 


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