In today’s stock of the day, let’s focus on The Walt Disney Company, which appears to be preparing to end its bearish correction that has lasted since the beginning of July. The correction phase is shaped like a falling wedge, a bullish pattern marked with black lines, suggesting that the recent weakness might soon give way to a fresh upward move.
Most recently, price bounced off the key green horizontal support, confirming that buyers are stepping in and defending this crucial level. This reaction off support could represent the first stage of a potential reversal. However, for a proper buy signal to be activated, we still need to see a breakout above the upper boundary of the wedge.
Technically speaking, a daily close above both upper black lines would be a strong invitation to go long, indicating a shift in sentiment from bearish to bullish. As long as the price stays above the green support, the bullish scenario remains on the table.
Disney seems to be setting the stage for a recovery — and the upcoming breakout may mark the start of a new medium-term upswing.