Technical Signals Point to a Possible Breakout for DRAFTKINGS INC-CL A.

We've identified DRAFTKINGS INC-CL A (NASDAQ:DKNG) as a potential breakout candidate based on our stock screener's analysis. This breakout setup pattern suggests that after a strong uptrend, the stock is currently consolidating, potentially signaling a continuation of the trend. Keep an eye on NASDAQ:DKNG for further developments.

Zooming in on the technicals.

ChartMill utilizes a proprietary algorithm to assign a Technical Rating to every stock. This rating, ranging from 0 to 10, is computed daily by analyzing a variety of technical indicators and properties.

Taking everything into account, DKNG scores 10 out of 10 in our technical rating. Both in the recent history as in the last year, DKNG has proven to be a steady performer, scoring decent points in every aspect analyzed.

• The long and short term trends are both positive. This is looking good!
• Looking at the yearly performance, DKNG did better than 95% of all other stocks. We also observe that the gains produced by DKNG over the past year are nicely spread over this period.
• DKNG is part of the Hotels, Restaurants & Leisure industry. There are 135 other stocks in this industry. DKNG outperforms 94% of them.
• DKNG is currently trading near its 52 week high, which is a good sign. The S&P500 Index however is also trading near new highs, which makes the performance in line with the market.
• In the last month DKNG has a been trading in the 40.07 - 45.62 range, which is quite wide. It is currently trading in the middle of this range, so some resistance may be found above.

Check the latest full technical report of DKNG for a complete technical analysis.

How does the Setup look for NASDAQ:DKNG

In addition to the Technical Rating, ChartMill provides a Setup Rating for each stock. This rating, ranging from 0 to 10, assesses the level of consolidation in the stock based on multiple short-term technical indicators. Currently, NASDAQ:DKNG has a 9 as its setup rating, indicating its current consolidation status.

Besides having an excellent technical rating, DKNG also presents a decent setup pattern. We see reduced volatility while prices have been consolidating in the most recent period. There is very little resistance above the current price. There is a support zone below the current price at 42.42, a Stop Loss order could be placed below this zone. We notice that large players showed an interest for DKNG in the last couple of days, which is a good sign.

Trading breakout setups.

One strategy to consider is waiting for the actual breakout to occur, where the stock breaks out above the current consolidation zone. Traders can then enter a buy position, anticipating further upward momentum. As a risk management measure, it is advisable to set a stop loss order below the consolidation zone.

This article should in no way be interpreted as trading advice. You should always make your own analysis and trade or not trade based on your own observations and style. The article is based purely on some technical observations.

Every day, new breakout setups can be found on ChartMill in our Breakout screener.

Keep in mind

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.