Roku (NASDAQ:ROKU) has been on a mission to move higher lately. The popular television streaming platform provider surged last week after reporting earnings. Today, ROKU stock is making new all-time highs despite the major stock indexes staging a pretty good broad-based sell-off. ROKU stock is trading higher by $9.76 to $135.08 a share. While the stock is in a very strong up-trend it is now starting to look a big extended and overbought on the charts. Traders and investors should now watch the $150.00 level for major resistance. This resistance area is a level that is half way between $100.00 and $200.00, it often serves as excellent resistance when initially tested. When you combine this with the parabolic extension that the stock has had recently it should pullback from this level.
There has been a lot of chatter that ROKU stock could be a take-over candidate. So traders and investors must be careful when trying to sell short a stock like this. I will most likely look to buy put options on the stock should it trade up to the $149.00 - $150.00 area. This way if there is a take-over in the cards I will simply be risking the premium paid in the stock.
This coming Friday is options expiration for the month of August. It is a usually a trading week that is notorious for rumors, ridiculous up-grades and downgrades and lots of other market makers shenanigans. So traders must be on their toes this week especially when trading stocks such as ROKU and many other popular stocks.