Disney already had a tough trading day on Tuesday as coronavirus concerns weighed on Wall Street, and to make matters worse, its CEO abruptly announced his resignation. Robert Allen “Bob” Iger ended his 15-year tenure with the company effective immediately yesterday. Consequently, Disney’s stock price fell another 2.60% after trading hours on top of its 3.62% loss for the day.
The news came as a surprise for everyone. Although Iger had previously announced that he planned on retiring, investors had expected it to happen when his contract ends in December 31, 2021. Under him, Disney acquired Fox Entertainment, Lucasfilms, Marvel, Pixar and launched the company’s streaming service, Disney+. He has been succeeded by Bob Chapek who previously chaired Disney Parks, Experiences and Products and has been with Disney for 27 years.
Iger tried to assure market participants by saying that he will still chair the company’s board and ensure a smoother transition. According to him, the move would free him of day-to-day tasks and give him more time to focus on the creative side of the business.
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Disney Stock Price Outlook
On the monthly time frame, we can see that the Disney stock price is testing its previous lows for support around 128.20. If there are enough buyers, we could see the stock soon rally to its record-highs at 153.00.
However, it’s worth noting that the uptrend on Disney stock priceis still intact. If sellers continue to dominate trading, the stock could fall to the confluence of support around $120.50. For one, this price coincides with the rising trend line when you connect the lows of May 2018, December 2018, and March 2019. It also aligns with the 61.8% Fib level when you draw the Fibonacci retracement tool from the low of December 2018 to the high of November 2019. Lastly, Disney peaked at this level on August 2015.
Conversely, if the support level does not hold, Disney stock price could drop to its 2018 lows around 98.60.