Is DraftKings Stock Making A Comeback?

DraftKings Inc. DKNG shares were trading higher Wednesday, after receiving positive analyst coverage from Morgan Stanley.

Morgan Stanley analyst Thomas Allen upgraded DraftKings from Equal-Weight to Overweight and announced a $31 price target.

DraftKings was up 14.36% at $22.10 Wednesday afternoon.

See Related: Why DraftKings Shares Are Ripping Higher Today

DraftKings Daily Chart Analysis

• The stock looks to have bounced off support in what technical traders call a sideways channel. Resistance has been found near the $19 level in the past and it now looks to be holding as a level of support. If the stock continues to push higher for some time it may find resistance near $45 as it has in the past.
• The stock trades below both the 50-day moving average (green) and the 200-day moving average (blue). This indicates bearish sentiment, and each of these moving averages may hold as an area of resistance in the future.
• The Relative Strength Index (RSI) looks to have formed higher lows since late 2021 and now sits at 42. This shows more buyers have been pushing into the stock and it nears the middle line. A cross back above the middle line will show that there are more buyers in the stock than sellers.

What’s Next For DraftKings?

The stock looks to be bouncing off the $19 level, as it is a key area where resistance was once found. If higher lows can form, the stock may continue on its bullish push. Bullish traders are looking to see these higher lows get formed as well as a cross above the moving averages and the RSI to cross above the middle line.

Bearish traders are looking to see the stock turn back around and see a break back below the $19 level and for this area to hold as resistance once again.