ROKU has been slaughtered over the last couple weeks. Is it time to buy for at least a bounce? I'm leaning towards yes... but I haven't really gotten an entry reason.
ROKU fell more than 40% from wick to wick on the candlestick chart. That's pretty incredible... however, they have had a tremendously good year. I'm not saying they will go up and retest their all time highs, but why not make a little money off a bounce that is bound to happen at some point. That some point might be now.
Roku definitely is up against big players now which can only hurt profits some. But hey, I use one and love it so why change? I think many people will feel the same way so it will support at some point once the craziness is over and the key will be finding that point and riding the rally back up which will probably be substantial. Lots of down down down for now though so will take a solid two if not three waves down to find a decent support area and start showing divergence on the technicals.
crackershell
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I slightly have a different take on this, mostly due to fierce competition.
roku first got slaughtered on Appl event (cheap apple tv subscription 4.99), then DIS is entering in content cutting netflix big time.
and amazon has event tomorrow.
that being said, my inclination is it will go futher down may be testing 96/93 range
Bankuur
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@crackershell, I don't disagree with you. In fact, I did not enter a position yet because I really haven't received any signal, on any time frame, to justify an entry. But, I do believe ROKU is unique, as they are a true streaming service. The other names you mentioned (besides Netflix) do many other things besides streaming. For that reason, I think ROKU is still a niche play. But you are right, they are getting slaughtered, and the slaughtering may continue. I will be keeping my eyes open for an entry to at least play a little bounce.
crackershell
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@JayC81, thanks Jay. It's good idea not to time the market. I completely agree on it, Roku is unique in the fact that it is a platform and earned it's spot. Keeping a close eye for any trend reversal indicators, but till then waiting for second confirmation.
ronchik4444
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Im currently learning the technicals. What does the gap represent? what is the significance of filling the gap? and finally what do you mean by oversold? Thanks :)
Bankuur
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@ronchik4444, The gap is simply a place in the market where price jumped up (or dropped) at market open, in relation to where it closed the previous session. Filling the gap is when the price eventually comes "back around" to where it started pre-gap... I think the statistic is (and don't take my word for this) that gaps get "filled" about 90% of the time. I'm actually currently working on my own back-test study to see just how accurate that 90% of the time is. For a stock to lose value, there has to be more sellers than buyers. When a stock becomes "oversold" it is simply an indication via the RSI that the price may be too low at the moment, and it might indicate that a reversal could soon happen. Notice I said "might" a lot? That's because NO indicator should be used as a sole means to enter or exit a position. RSI stands for Relative Strength Indicator, and it is one of my favorites. Google "relative strength index" to learn more... there is a TON of information out there on most of the indicators used in technical analysis. And actually, since you mentioned it, I will write a post on my blog soon (dumbmoneytrader.com), describing what the RSI is.