In the recent 3 years, Walt Disney stock price (NYSE: DIS) hovered between $120 and $90 without any real trending momentum. Last year, we looked for a potential break to new all time highs in Disney based on few scenarios which seems to be still playing out.
Taking a look at the weekly chart, we can consider the 3 years as a consolidation period of time after a strong 6 years of rally. Therefore, we expect the stock to do a breakout to the upside following this bullish flag type of structure.
Disney DIS Weekly Breakout Chart
In Elliottwave Forecast, we use the swing sequence count along side other tools to define the current trend and cycles allowing us to remain on the right side. Counting the swings for Disney since 2016 low, we can see that it’s showing an incomplete 5 swings bullish sequence and looking to extend higher toward $126 – $133 as a daily target as long as pullbacks remain above $96.2 low.
Disney DIS Swings Sequence
Now, as we have bullish sequence for DIS suggesting a move higher to new all time highs, then we can use the Elliott Wave Theory structures to define the current move.
Usually this type of consolidation happens during a bullish triangle in the 4th wave of an impulsive structure suggesting that the next leg higher could be a final acceleration before a cycle ends followed by another 3 waves pullback. In the case of Disney, the next target for a wave V would take it higher toward $130 – $144 area which would be achieved with a clear 5 wave move to the upside.
Disney DIS Triangle wave IV Chart
However, looking at the current structure since 2016 low, DIS could be doing a 5 waves ending diagonal as well with the same target around $130 area suggestion more time before reaching the final target to end that cycle.
Disney DIS Diagonal wave V Chart
Disney DIS Showing a bullish sequence since 2016 low looking to trade higher and break 2015 peak toward $130 as a minimum target before another correction takes place.