Chart Wars: Do Playboy Or Roblox Have A Big Breakout Ahead?

Playboy Group, Inc PLBY and Roblox Corporation RBLX have both formed long-term bullish chart patterns that could provide massive upside for the long-minded trader and investor.

Playboy has formed a bullish cup-and-handle pattern on the daily chart and Roblox has created a bull flag pattern on the weekly chart, with both stocks looking close to completing their patterns. Both the cup-and-handle and bull flag patterns form after an initial move higher that is followed by a period of consolidation.

It should be noted, however, that events such as the general markets turning bearish, negative reactions to earnings prints and negative news headlines about a stock can quickly invalidate bullish patterns and breakouts. As the saying goes, "the trend is your friend until it isn't" and any trader in a bullish position should have a clear stop set in place and manage their risk versus reward.

See Also: How to Read Candlestick Charts for Beginners

In The News: In October, both Playboy and Roblox advanced their forays into the NFT space, which gives both stocks a solid foot into the future as collectors and technology enthusiasts begin planning their eventual move into the metaverse.

On Oct. 20, Playboy announced the launch of its newest collection of 11,953 Playboy Rabbitars. Meanwhile, on Oct. 14 TechCrunch reported Roblox plans to allow creators to design and sell Roblox items and collect royalties from future sales of the items, which adds an NFT quality to the platform.

Want direct analysis? Find me in the BZ Pro lounge! Click here for a free trial.

The Playboy Chart: Playboy has settled into a cup-and-handle pattern with the cup forming between June 10 and Nov. 16 and the handle between Nov. 17 and Thursday.

• The handle may need to develop further before the stock breaks bullishly up from the pattern.
• Traders can watch for a break up from the upper descending line of the flag on high volume to gauge whether the pattern has been recognized.
• If the pattern is recognized, the measured move is about 55%, which means Playboy could trade up toward the $50 level in the future.
• If Playboy falls below the $29.94 level, the pattern will be negated.

The Roblox Chart: Roblox has formed into a bull flag pattern on the weekly chart, with the pole forming between Nov. 8 and Nov. 22 and the flag created over the last three weeks.

• On the daily chart, there is a gap below between $79.02 and $93.03 traders should be aware of because it is likely Roblox will drop down into the range at some point in the future.
• The measured move on a break out from the pattern is about 80%, which indicates Roblox could trade up toward the $187 level in the future if the pattern is recognized.
• If Roblox falls below a support level at the $103.87 level or closes a week below the eight-day exponential moving average the bull flag will be negated.