The value of Forex on the shares of Sony gained close to 12% after investor Daniel Loeb proposed the separation of Sony` s entertainment division from the holding company. The investor` s proposition is aimed at following the general TV business rally which has already reached a three and half years increase. The idea is basically for a sale of 20% of Sony` s movie, music and TV business in order for the independent company to benefit from a more disciplined management, investors` attention and a larger profit for the holding company. It is expected that Sony could potentially raise $6.1bln from the sale of its division. Comparing the market value of Sony with key competitors such as Disney, Lions Gate and CBS which are all at their all- time highs, Sony appears to have fallen behind them. More detailed fundamental analysis suggests that current market price is 8 times EBITDA and shares could potentially surge 60% more in case the unit is gets partially sold.
The graph provides a clear representation of the steep upward trend, which started at the beginning of the month. The change from 1560 to 2153 more than clearly expresses Forex investors` future expectations. The Bollinger Bands provide the relative range within which Forex should be trading. The short term support level is set at the bottom at 1560 as the level indicates bearish investors` aim. The intersection of the 50 and 200 Day Moving Averages coincides with the origin of the steepest increase, suggesting the presence of a great technical analysis` credibility. The short term resistance level is set at the top at 2153, but this level is expected to be surpassed as early as the next trading session. Although the Relative Strength Index suggests a forthcoming brief correction, Forex investors could potentially benefit from the longer term positive trend.
Disclaimer: The information in the above analysis is collected from different sources and should serve for informative purposes only. The author shall not be held responsible for the validity of the presented information. No part of this analysis recommends the purchase or sale of a currency pair or any other financial instrument.