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DRAFTKINGS DRN

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D2KN34 trade ideas

DKNG Wave 2 CorrectionDKNG is currently correcting. Yes, there is a lot to look at here, but just watch the Elliott Wave count and the trendlines. It broke a 2 month uptrend line yesterday, retested, and came back again. It has finished the overall upward Wave 1 move (made of 5 waves), and is now correcting down to one of the 4 green support fibs I've drawn. The 4 supports drawn are $47.92, $45.43, $42.94, and $39.87. We have confluence with a fresh (price has never touched) demand zone at $40, & it is an important psychological support for a stock that has so much bullish sentiment around it. If I had to guess, the correction would be most likely complete at $40, assuming none of the others hold. From the drop this week, we've created stacked supply . This means that the next time price returns to this zone, DKNG is likely to get held up, unless bulls are extremely strong. The entire price area from $51.50 to $55.50 contains daily or hourly supply (since sellers have been in control since December 18th). So, be cautious next time price touches that area. As I said before, there is confluence at every fib support level. We have a used daily demand from $47 - $49, along with a smaller 2 hour demand within that. I believe price is likely to break this zone and continue correcting downward, but we have already seen a small bounce in the zone. This confirms there is still demand/buyers in that area. The next major demand zone is from $46 - $47, and finally, 1 hour demand at my preferred target of $41-$42.90 . The final zone around $41 is the unused one, making it the most likely zone to hold, as price has retested all other zones at least once. Zones being retested eliminates the buy orders in that zone that hold the stock up, so a zone that has never been retested still has buy orders ready to be filled. At the time of writing, we have a bullish divergence on the hourly MACD . That tells me we're due for a pop back up in price very soon. DKNG is also technically oversold on the RSI, adding confirmation of a short term pop. On this potential bullish move, I believe $51 is a good target to be out of a long position. The previously mentioned daily supply begins at $51.45, and my 2 month upward trendline has been broken, and is now confirmed as resistance. Price traded at the trendline, and could not break back above it. If we get a move up, price should extend far enough to hit this trendline, which is around $51, depending on how long the move takes. In total, expect a month long pullback on DKNG. It had a very strong 60 days from November to December, and already seems to have started the correction.
NASDAQ:DKNGShort
by Jomo_Davis
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