Boston, MA 10/06/2014 (wallstreetpr) – Sirius XM Holdings Inc. (NASDAQ:SIRI) (Closed: 3.42, Up: 0.88%) is hurt by the recent ruling by a Californian Federal judge, deciding the company to be liable of copyright infringement in a case lodged by the pop band The Turtles, accusing the company for non-payment of royalties. SIRI plans to appeal against the ruling but the uncertainty and huge future implications may keep the stock price on tenterhooks.
Sirius XM Holdings Inc. (NASDAQ:SIRI) has registered daily highs at the levels of $3.64-65 at least five times in the month of September and the last half of the month saw a deep correction, retracing almost all the gain made in the last two months. But the last correction is clearly seen to be subdivided in 3 parts, with two drops of exactly equal magnitude, punctuated by a sideways consolidation for a week. It suggests the completion of an A-B-C correction and a bounce to $3.52-54 on an immediate term looks very likely. Still, it may be too early to tell if the correction is complete or the entire fall from $3.65 to $3.32 is just the first part of a larger correction.
The bulls may take heart from the fact that the recent low of Sirius XM Holdings Inc. (NASDAQ:SIRI) at $3.32 is not only very close to the last medium term swing low area of $3.28-32 made in last July-August, it is also very close to the lower boundary of the long term channel containing the entire rally from the 2011 bottom of $1.27 till now. If $3.28-32 remains intact, expect resumption of uptrend and a rally to $3.65-$3.72 in the coming weeks. Obviously, the Sirius XM Holdings Inc. (NASDAQ:SIRI) bears need a quick break below $3.28, especially in the light of the recent bullish crossover between 50 day moving average and 200 day moving average.
Aggressive investors may buy the stock at the current levels with a very strict stoploss below $3.28 levels and book partial profit near $3.52 and again near $3.65.