ROKU is Consolidating As Options Expiration Approaches
I'm not completely sold on the ROKU uptrend that began back in mid-March. I realize that it's doing what many growth stocks are doing - namely, rallying. But there are definitely differences on the ROKU chart that makes me question the sustainability of this advance. The first issue I have is that there still remains a lot of net in-the-money calls that will expire at the close of trading on Friday. That's likely to put a ceiling on the
stock for now:
But maybe a bigger question is the lack of support from the accumulation/distribution line (AD Line). We've seen dozens and dozens of stocks appear to be under heavy accumulation during the pandemic and now they're moving considerably higher as their AD lines follow suit. ROKU doesn't seem to have that same support from institutions. It actually seems as though there's been distribution throughout this rally. Key price support resides in
the mid-130s to mid-140s. ROKU longs should be very careful if that support zone is lost.
