Wynn Resorts, Limited. (WYNN) shares rose more than 8% during Monday's session amid higher Macau gaming revenue. The Chinese region's gaming bureau said that June's gross revenue rose 5.9% year over year to 23.81 billion patacas. With the U.S.-China trade war in full force, investors were worried that regional rivals in the Asia-Pacific could lure the VIP segment away from Macau's casinos, but the second straight month of increases has helped reassure the market.
While Macau may be strengthening, there are signs that the Las Vegas market is weakening. The State of Nevada reported that gaming fell 5.96% to $981.84 million in May, which sent shares of many casino stocks lower last Thursday. Investors will be closely watching performance in both regions over the coming months – particularly if the U.S.-China trade tensions are resolved in upcoming state visits.
From a technical standpoint, Wynn stock broke out from the 50-day moving average at $124.90 to reaction highs of around $132.00 from late February. The relative strength index (RSI) moved closer to overbought territory with a reading of 67.98, but the moving average convergence divergence (MACD) remains in a bullish uptrend. These indicators suggest that there could be some near-term consolidation before a move higher.
Traders should watch for some consolidation above reaction highs of around $132.00 or the 50-day moving average at around $125.00 over the coming sessions. If the stock resumes its uptrend, traders could see a retest of prior highs near $150.00, but if the stock breaks down from support, traders could see a move lower to retest the 200-day moving average at $118.20.
The author holds no position in the stock(s) mentioned except through passively managed index funds.