Activision Blizzard, Inc. (ATVI) shares rose about 1% during Monday’s session, before falling amid a broader market slowdown, after Goldman Sachs resumed coverage with a buy rating and a hold rating. $110.00. target price.
Key points to remember
- Activision Blizzard shares rose briefly during Monday’s session after Goldman Sachs took cover with a buy rating and a price target of $110.
- Analyst Michael Ng notes that proxies for engagement hit record highs during the fourth quarter, while other analysts see momentum in China.
- The relative strength index (RSI) remains close to overbought levels, and the moving average convergence divergence (MACD) is in neutral territory, suggesting that the stock could experience some consolidation.
Proxies for undertaking
Analyst Michael Ng noted that proxies for engagement hit record highs during the fourth quarter of 2020, surpassing levels seen at the height of the pandemic. In addition to Activision Blizzard, the analyst took over coverage from Take-Two Interactive Software, Inc. (TWO) and Electronic Arts Inc. (EA) with buy odds, citing momentum in the playing space.
The move comes shortly after Morgan Stanley’s Brian Nowak said a strong start to Activision Blizzard’s “Call of Duty Mobile” in mainland China likely generated more than $80 million in total consumer spending so far. now since its launch at Christmas. Nowak maintains an overweight rating on Activision shares with a price target of $108 and a bullish price target of $130.
From a technical standpoint, Activision stock has decided to retest its highs reached last week. The RSI remains high with a reading of 68.07, while the MACD remains in neutral territory. These indicators suggest that the stock could see potential consolidation ahead despite the bullish news.
Traders should watch for consolidation in the stock’s rise price channel in future sessions. If the stock breaks down from the trendline Support At $92.90, traders could see a move towards the 50-day moving average at $85.41, although this scenario seems less likely to occur given the bullish fundamentals. If the stock breaks from previous highs, traders could see a move towards the upper trendline resistance nearly $98.00.
Overweight, and its opposite underweight, are used by analysts and commentators in recommendations to buy or avoid particular investments or sectors. For example, if federal defense spending is about to rise or fall, an analyst may recommend that an investor overweight or underweight defense-related companies.
Activision Blizzard shares rose briefly on Monday before losing ground later in the session after Goldman Sachs took cover with a buy rating and a price target of $110. Despite the bullish sentiment, technical indicators suggest the stock may experience some consolidation before resuming its uptrend.
The author does not hold any positions in the stocks mentioned, except through passively managed index funds.