Looks like CD Projekt Red formed a double bottom and broke out of an upward channel to the upside. It also broke out of the huge falling wedge it was forming since its decline that startet in December 2020. Yesterday was the retest of the upper dynamic resistance of that wedge. With todays candle it perfectly bounced off. This is pretty good!
Next resistance is at 46.890, also where the EMA100 is at the moment. I guess we will see a rejection from that level and a bounce from EMA50, before we go higher. From the fibs it also looks pretty good. If we pass 104.950, we could go up until 148.950-232.525. This is quite huge potential.
From the fundamental side: 1) Of course, CDPR had issues with the release of Cyberpunk 2077. However, it seems like they were able to fix a lot of bugs and it looks as if the title will be back in the PSN store any time soon. Further, CP2077 got some more positive awareness since it runs on the newest generation of Tesla's infotainment system. 2) On the other hand, the lawsuite is still ongoing. But, they made quite a huge amount of money with CP2077 and had only very few refunds. And similar cases exist that went well for the game studio (see EA and Battlefield). I expect the same for CDPR here, since the numbers are really well and the title runs better now. 3) The Witcher Season 2 will be released on Netflix this year and that series had some good reviews so far and extended the fanbase of that franchise - even though there were some controversial discussions about the cast. And the Witcher games sold pretty good upon the release of Season 1! 4) CDPR sits on a huge pile of cash for further development of AAA titles. Some updates are due in the second half of 2021 (NextGen Witcher, Mobile Witcher Hunter game).
So, in my opinion CDPR is on a good way to recover. Let's see how this plays out. I am looking forward to any comments. As always, this is just my opinion and no financial advice. What do you think?
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As expected, rejected from the 46.890 level and now at the EMA50 and support @40.160 and retesting previous dynamic resistance of the falling wedge. This seems like a strong support and it should hold that area for further upward movement. If it fails, we could see retracement up until the 34.800 area to - in the worst case.
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Looks like we leave the support area today and the 46 level should be the first target. This time I think we will pierce through that resistance and go to 52 - 55 before we may see another retracement (rejection from MA 200 and historical resistance / 0.5 fib). After that retracement, I think we will go up up and away.
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FA update: Positive news over the weekend about the release of The Witcher: Monster Slayer: It is supposed to go online on July 21st.
Even though it is a free to play game, I think it will get a lot of new people into the whole The Witcher universe. This could lead to increased The Witcher sales and it may also be a boost to CP2077. Of course it depends on how well it is playable in the beginning. But I think a lot has been learned from the CP2077 release. One also has to keep in mind, that CP2077 works now even better on PC. I still see a very low probability of success for the lawsuite.
Last but not least: WitcherCon may hold additional positive news as well as a first look on The Witcher: Monster Slayer. It is on July 9th and 10th.
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What a nice weekend for CDPR: In my opinion the WitcherCon was a full success. The Witcher IP will get more and more visibility: - Witcher AR mobile game launch in July 2021 - Witcher Anime in August 2021 - Witcher Season 2 in December 2021 - Witcher 3 NextGen Edition with DLC related to the series in 2021
With rising visibility, CDPR may also sell more copies of The Witcher 3.
Further, it has been noticed that CP2077 is in a top spot in the PS4 store with regard to sales figures. Even though the gaming experience is limited on PS4 classic, it looks like interest is quite high on the PS platform and a lot of copies have been sold. Looking forward to the numbers of this quarter!
I recommend taking a look at the stream of the WitcherCon.
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So CDPR left the upward channel to the downside a couple days ago but it consolidated in the 36€ area and now it printed a bull flag on the daily which it broke out of yesterday and it started outside of that bull flag today. That is good! I think we will see ~48-49€ next.
@szehrer, thank you for the comment! Yes, I think so actually. At least I expect a trend reversal once we are in the area between 33-35 € from a technical point of view. Until then, we are in a downward channel.
However, I read some rumors about a Witcher 4 game the other day: CD PR is looking for people to work on a new RPG game set to take place in the Witcher cosmos. This of course could infuse a run upwards before we even reach that zone. And another important thing are the upcoming earnings. But for now and in my opinion it points towards 33-35€ before we see another updward move
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@narfi Looks good after earnings. Seems 36 was the bottom. Hope it will retest 45 soon and break up to sma 200 at ~ 50. what do you think?
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@szehrer, thank you for the comment and sorry for the long wait for my answer! It also seems to me that 36€ was the bottom. Currently, I see the potential for a bull flag forming on the daily. From here it could go as low as ~39€ before going up again. The 39€ area is a strong support in my opinion: The EMA50 and the 0.236 fib retracement are there. So I expect a bounce upwards once we reach that region.
If this is going to print a bull flag we could see 46-48€ somewhere around the last week of September. Maybe even 50€. I think it will reach the EMA200 actually, which is around 49€ at the moment on the daily. It may retrace a little bit once it hits, but I see a lot of potential to the upside once it breaks the EMA200.
On the fundamental side, there could be good news once a release date is anounced for the next-gen versions of CP2077 and Witcher 3 for playstation and x-box. So far, they have not committed on a concrete date and the latest news had no release date. They still aim for a release end of the year but cannot give a guarantee since they learned from their mistakes with the CP2077 release. I get mixed signals from this news. However, I am still overall bullish on CDPR.
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Your thinking is always similar to mine but ever time I underestimate the pull backs from a resistance- 12% in only two Sessions… Are you still bullish? I was holding as hoping for 52 Euro after it broke 200sma Ema 50 at 187 zloty might be a point for a turnaround?