Using the Force, Disney Stock Looks to Succeed in 2020

Don’t dismiss the bullish story in DIS stock that's unfolding on the price chart

Disney (NYSE:DIS) is still enjoying last year’s leftovers. But on today’s DIS stock price chart, 2020 is looking every bit as delicious for bullish investors.

Source: ilikeyellow / Shutterstock.com

For entertainment giant Disney, the story remains fixated on the company’s holiday movie releases Star Wars: The Rise of Skywalker and Frozen 2. Not that there’s anything wrong with that.

The latest and final Star Wars space opera is on pace to become Disney’s seventh film to gross more than $1 billion globally. And it could very well become the company’s biggest blockbuster ever. Meanwhile, the sequel to the smash hit Frozen has already topped $1.3 billion to become the highest-grossing animated feature film of all time. Leftovers never looked so good, right?

Looking ahead though, 2020’s crop of cinematic releases is going to have a tough task capturing a spot on the $1-billion-or-better list. Disney may have a shot with the upcoming Mulan feature. However, the fact is none of the company’s other big-time franchises such as Avengers or Toy Story have sequels this year. Uh, oh? Probably not.

The good news is the House of Mouse likely has other tricks up its sleeve. For one, there’s the recently launched Disney+ platform. Sure, there’s been some complaints as Disney irons out the wrinkles. But overall the streaming service is off to a decent start as it takes on streaming competition Netflix (NASDAQ:NFLX), Amazon (NASDAQ:AMZN), Apple (NASDAQ:AAPL) and others.

Disney also has its ever-popular, record-breaking amusement and theme parks. Along with its products segment, these businesses raked in over $26 billion in 2018. And despite the box office bonanza in 2019, the trio are still the company’s largest revenue generator. What’s more, with the very well-received Star Wars-themed “Galaxy’s Edge” park launched in 2019, there’s every reason to believe the company’s bottom, top and Disney stock’s squiggly price line are going to do just fine in 2020.

Disney Stock Price Weekly Chart

Source: Charts by TradingView

2019 was a breakout year both literally and figuratively for DIS stock. Shares rocketed higher after a third attempt at clearing a massive triangle consolidation pattern nearly three years in the making. And in my view, 2019’s performance of 35% is in position to offer Disney investors a sequel-like gain in 2020.

Currently the past four-plus weeks have been spent in a lateral congestion pattern centered at Disney stock’s July all-time high. It appears to be a bullish “high handle” formation. Supporting this optimistic description is the fact the pullback follows fresh highs after a breakout from a classic cup-shaped base which formed without a handle inside the larger pattern.

Even if this sort of labeling isn’t your cup of tea, don’t write off Disney stock. It has a well-positioned stochastics indicator on the cusp of a bullish crossover and a weekly doji ideal for buying decisions and stop-loss management. Choosing to dismiss Disney’s unfolding story on the price chart could prove a big mistake.

Investment accounts under Christopher Tyler’s management do not currently own positions in securities mentioned in this article. The information offered is based upon Christopher Tyler’s observations and strictly intended for educational purposes only; the use of which is the responsibility of the individual. For additional market insights and related musings, follow Chris on Twitter @Options_CAT and StockTwits.


Article printed from InvestorPlace Media, https://investorplace.com/2020/01/using-the-force-disney-stock-looks-to-succeed-in-2020/.

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