If I told you 3 years ago that there was such a thing as a boring day with SiriusXM, you would have called me crazy. Well, that's exactly what we had today. Guess what. These are the times when you need to pay attention. We have been seeing consolidation behavior in a tight range, seen the support levels gain strength, and seen the EMA's try to constrict a bit while the 50 day EMA is working its way to $3.60.
Volume today was lighter than average and lighter than the previous session. Classic consolidation. From a volume perspective we are looking for a move on over 60 million shares. Such a move will be your first hint on direction of the move. In my opinion a bullish move is more likely than a bearish, but be prepared for either.
Support and resistance is getting interesting. What we have is very strong support at $3.76. We have been consolidating above this level. If that level breaks, we will see consolidation below. In my opinion we have little to worry about in either direction. The next moderate support point below is all the way doe=wn at $3.25, but we have added protection at the EMA levels.
The 50 day EMA now sits at $3.57. That is a support level. the 20 day EMA is at $3.71. The 13 day EMA is at $3.75. We did trigger a warning flag today at the 5 day with a close below that EMA which sits at $3.80. What has been happening lately is a cycle of caution flags and then clearing those flags. If Sirius XM stays in a very tight range at current levels, the effect will be to bring the 50 EMA closer to the rest, That constriction is what we are looking for. When the EMA's constrict, a platform for a move is created. We are in hopes that such an event, about a week away now, will be the trigger for a possible run to $4.
Watch the intraday volume closely in the morning. We want $3.76 to hold the line. If it passes below that on volume assess the strength of it and base your move on that (active traders). I do not look for a major retracement unless we break down through the 20 day EMA at $3.71. Remember, sometimes it is better to confirm a move before acting on it.
Support and Resistance
Exponential Moving Average