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Electronic Arts (EA) Slides Sharply as Apex Legends Fail to Impress

Electronic Arts $EA had a rough week. According to bloomberg.com, "the second release of 'Apex Legends' hit a snag, raising concerns the new version of the publisher's latest smash-hit may not satisfy gamers as hoped". 

Investors believe EA needs Apex Legends is key to EA's success this year. Nick Licouris, investment adviser covering video games at Gerber Kawasaki Inc. said "EA really needs Apex Legends to be cross-platform in order to take to it to the next level. “That was one great thing that Fortnite did.” (bloomberg.com)

The Bloomberg report added that there is some server issue to be ironed out. But it also noted that it is still early in the adoption cycle and Apex Legends could still pick up. 


EA has been in consolidation mode in 2019, with a slight bullish bias so far. However, if the current slide pushes price back below $90, that bullish bias will be eliminated.

EA Daily Chart

(click to enlarge)

Bullish Attempt; Key Pivot at $90:
- On the daily chart, we can see that price essentially found a bottom by February 2019.
- Price found support at $75-$77 area twice, and then eventually cleared back above $90.
- Price then rallied to $109 before sliding. But since February, price has remained above the $90 pivot.
- Thus $90 is a critical support. Recently, price broke above a falling resistance, the $100 market, and the cluster of moving averages. This was a bullish sign, but the unimpressive launch of Apex Legends V.2 rejected this bullish breakout.
- Still, if price can hold above $90, there is still a chance for EA to continue a bullish recovery in 2019,
- In this bullish recovery scenario, there is at least upside to $110-$115. 
- A break below $90 on the other hand exposes the 2018-2019 lows around $75-$77,

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