My bet is $PENN is going higher. (September 09, 2020)

by DAN PENN 
This is Scott with your Chart of the Day. I want to take a look at Penn National Gaming ( NASDAQ: PENN ). I will be honest with you, I hadn’t even heard of this company before Davey Day Trader came along and then the whole thing with Barstool.

This stock has been resilient; it has rallied off the March lows and has kept going. Even in the last couple of days, the market has been quite volatile. Penn National Gaming ( NASDAQ: PENN ) has just kind of gone sideways. The market basically imploded, Penn ( NASDAQ: PENN ) went down 5 percent, maybe 9, and then rallied but held above all of its major moving averages this entire run.

The last couple of sessions we have had some pretty tight price action and today we closed just under a recent level of resistance right around $59.00. So my bet is, that with a little volume push we could get a little bit of a volatility squeeze here on Penn ( NASDAQ: PENN ) pushing the stock higher. I have an alert here on Penn ( NASDAQ: PENN ) at 59.09. I want to see the stock get above 59.09, stay above 59.09 and do it on higher than average volume.

The volume lately has just been okay but we need a real push above and we want that volume to come in kind of like this, so I think it’s worth keeping an eye on. If I flip to a long-term time frame you can see, weekly, the stock has really just kind of been going sideways. Some nice weekly tight action, we just need a break above that level coming on high volume. So keep an eye on Penn National Gaming ( NASDAQ: PENN ) for a potential breakout to the upside.

Now one thing I will say is the stock is only really been going sideways for about a month here so it is kind of a shorter base. So because of that, I would definitely want to trade this with a smaller position size, maybe go half size just because it’s not coming out of a long base of consolidation; this is kind of a short base of consolidation. But still, I think it’s good for a move to the upside if we can get above and stay above $59.00.

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