This equity can not seem to stack more than two consecutive days of consistent volume and movement. Today we saw the equity trade up again, but the volume dropped back down substantially. Going up is good. Going up on low volume does not demonstrate strength.
It seems that we are stuck in a rut with a lack of compelling news to drive the stock. The financials are healthy. Auto sales are good. The used car channel is maturing daily, and the company is finally developing its IP presence into something that is meaningful. Despite all of these positives, the equity seems to be at a struggle to really challenge new highs.
Volume was very light today. With only 35 million share changing hands it becomes difficult to get excited about the gain for the day. The equity exhibited little strength and there was no surprise that it did not test above $3.08. What we want to see is volume align with price movement and a trend develop that lasts at least three trading days. The short interest on the equity remains high, and that is something to watch, but the real key that I see in the next week is what transpires with the 7% note tender offer. With two weeks to go not a single bond holder jumped at the offer. Will SiriusXM have to sweeten the deal?
Support and Resistance
The support and resistance is shaping up with some ranges developing. I show resistance at $3.09 that and support below at $2.99. We are on the cusp of a decision point for this equity. Will it establish a new range between $3.00 and $3.10, or will it establish that range between $3.05 and $3.15. The balance of this week may give us the answer. As an investor you should be prepared for the equity to dip as low as $2.90. In my opinion there will be a lot of pressure on the markets created by political issues now in play. It could be a positive for the market or a negative. It is likely worth at least a few cents to SiriusXM when the news develops.
Exponential Moving Averages
We have three cautions and 3 warnings. If the equity closes at $3.05 we will add a caution. There is quite a bit of room before another warning flag would develop. Right now it looks like EMA's want to converge at about $3.09 -- the resistance level. When EMA's are this tight with SiriusXM a move of at least a nickel is not far behind. Watch closely.