Well, the call is over, and many records were announced. SiriusXM did run up a dime, but the volume was not very impressive. With just 65 million shares changing hands, it would appear that the buyers are not lining up out of the door. There is a compelling story here, but it would appear that it is not enough to overcome what some perceive as a high valuation. If you value SiriusXM by an improved EBITDA number for 2014, it is sitting in a sweet spot right now. If you are using current EBITDA guidance for 2012, it is at a high valuation. I suspect that the lack of a more substantial run could be attributable for investors being more conservative on this equity at the moment.
Before going into the staples of volume, support and resistance, and exponential moving averages, I want to take a moment to look at the relative strength index (RSI). The RSI is indicating that the equity has moved from about 60 to 66.46. An RSI of 70 is considered overbought, 50 is neutral, and 30 is oversold. We are still bullish, but approaching overbought territory.
This equity needs to move up on volume tomorrow that is greater than the 65 million we saw today. If that does not happen, then $3.80 will build resistance and the equity may sell off and/or consolidate
The strongest immediate resistance below is at $3.59, with $3.50 being the next stop after that. The 13 day EMA provides a little support at $3.64. The 20 day EMA is aligned with the support at $3.59, and the 50 day EMA is sitting just below the support at $3.50.
The key here is what the volume is tomorrow. That will tell us if we will continue to stretch for higher highs, or if we settle down a bit and consolidate in the $3.60's.
Support and Resistance
Exponential Moving Averages