DISH Network Stock Is at a Very Important Inflection Point

DISH Network Stock
credits:istock.com/LaymanZoom

DISH Stock: Indications Support Higher Prices

I am focusing on DISH Network Corp (NASDAQ: DISH) stock because it is currently testing an extremely important level of price support. What happens on this level of support will determine the direction that DISH stock is likely to venture in next. In essence, DISH Network stock is at a very important inflection point, which means it is an excellent candidate to base an investment strategy around.

Before I identify this level of price support, let me explain that my views on DISH Network stock have been created using a method of investment analysis known as technical analysis. This method is predicated on using historical data to gain a grasp on what the future may bring. I have been applying this method for roughly two decades and when it is applied correctly, the results are outstanding.

The following DISH Network stock chart illustrates this infamous level of price support I am referring to.

DISH Network stock chart

Chart courtesy of StockCharts.com

This DISH stock chart illustrates a bullish trend that has been in development since 2009, which marked the conclusion of the financial crisis. This bullish trend contains the quintessential characteristic that defines all bullish trends, which is a sequence of higher highs and higher lows.

The uptrend line highlighted on the DISH Network stock chart is created by connecting the sequence of higher lows that characterized the bullish trend. This uptrend line acts as a level of price support and, just based on the number of points of contact, it is easy to see why this trend line is significant.

Using the trend line as a tool, I can conclude that as long as DISH stock is trading above it, I can only assume that the bullish trend that began in 2009 is still intact and, therefore, higher stock prices will likely prevail.

This uptrend line was just tested and if I were looking to go long on this stock, I would be inclined to do so because my risk is defined using the uptrend line. The caveat is that if the price falls below the uptrend line, it would negate all the bullish implications and would be reason enough to exit my position.

Using one indication on its own as an investment strategy is never a good idea. Therefore, I have provided the following DISH Network stock chart, which illustrates an influential momentum indicator suggesting that higher prices are likely to prevail.

Dish Network Stock Chart

Chart courtesy of StockCharts.com

This DISH stock chart focuses on the moving average convergence/divergence (MACD) indicator.

MACD is an indicator that distinguishes between bullish and bearish momentum using the crossing of a signal line. This signal is influential because momentum creates a path of least resistance and a stock cannot make a sustained move toward higher or lower prices without the applicable momentum. Therefore, knowing which direction it is geared for is very pertinent information.

For example, earlier this year in February, DISH Network tested the uptrend line from above, and shortly after this event occurred, a bullish MACD cross was generated. These indications suggested that the path of least resistance for DISH Network stock was geared toward higher prices and the stock appreciated as a result.

The conditions presented earlier this year are once again present. DISH stock tested the uptrend line in October and a MACD cross is currently in development. I can only assume that DISH Network stock is going to stage a move toward higher prices as a result.

The uptrend line and MACD signal are the reasons why I believe that DISH stock is set to appreciate. This bullish view is contingent on the price remaining above the uptrend line.

Analyst Take:

I am bullish on DISH Network stock because the indications on the stock chart support this view. I will maintain this bullish view on DISH stock until there are indications suggesting that such a view is no longer warranted.