Trade Ideas Newsletter 04/14/2016

EA is at the beginning of a significant breakdown

Based on the previous analysis in EA, traders should ensure that their portfolio can handle increased risk from an additional trade. Also check to make sure that EA increases diversification of your current portfolio. Lastly, smart traders check how a new position relates to not just their account, but the current market action as well. For example, take a look at the S&P 500. Is it moving higher or lower? Has it recently moved through a key resistance or support level? Be sure to match up your trading actions on EA in relation to the overall market movement.

CHART

Right now the custom sentiment levels, measured by Traders For Wealth, indicate an increasingly negative bias toward EA. In addition, the price action in EA has been moving down as well. This could be a strong sign of an impending breakdown. Traders should view this as a very bearish trade and make sure it matches up with the overall market, and their current portfolio.

Electronic Arts Inc. (EA)

Electronic Arts Inc is a game software content and services provider. The Company develops, markets, publishes and distributes game software content for consumers of various video game machines and electronic devices. It also provides game software-related services. The Companys brands include Battlefield, Mass Effect, Need for Speed, Dragon Age, The Sims, Bejeweled and Plants v. Zombies, as well as brands based on licensed intellectual property such as FIFA, Madden NFL and Star Wars. The Company is organized around three divisions: EA Studios, Maxis and EA Mobile. The EA Studios division develops games and related content and services across a range of game categories, including the FIFA, Madden NFL, Need for Speed, Battlefield, Mass Effect and Dragon Age. The Maxis division creates games, and related content and services that engage player creativity. The EA Mobile division focuses on developing and publishing interactive games for mobile phones and tablets.