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Disney (DIS) - Get Free Report closed at new rally highs on Wednesday and is quickly approaching a major resistance zone.

With another $2.50 of upside, the stock will fill the major breakdown gap left behind back on Aug. 5. The day before this collapse, Disney marked its 2015 closing high at $122.08. It's very likely that Disney will have difficulty moving past this key area without a healthy pullback.

For investors, a return to the $120-to-$122 area may provide an important profit-taking opportunity.

In the two and half weeks following Disney's earnings-inspired breakdown, the stock fell over 25%. This was the steepest decline the stock had suffered in years, and it pushed Disney to a deeply oversold reading as measured by its moving average convergence/divergence indicator. With the help of the panic selling wave that hit stocks on Aug. 24, Disney hit an oversold level not seen since 2008. Along with the bulk of large-cap stocks, Disney recovered quickly before spending the month of September in a tight consolidation just below its 200-day moving average. Once shares moved back above the 200-day, a second leg of the post-Aug. 24 rally was underway.

Disney suffered what could have been a significant setback on Nov. 4 just as the second leg of the rally began to show signs of exhaustion. The stock finished the day with a nice bounce off the early lows but still closed below trend line support. The downside pressure continued the next day, but there was no further damage. Since then the stock has clawed back and is now clear of the key downside reversal left behind on Nov. 4. More upside appears likely in the near term, but the gains will be limited.

Investors should consider taking partial profits on their Disney holdings as the stock approaches the huge Aug. 5 breakdown gap at $120.60. This is the bottom layer of a heavy resistance zone that includes the 2015 peak of $122.08. With upside trade trending below average of late and the stock still in overbought territory, a takeout of this zone will be very difficult. A pullback will be needed first to allow the current bull trend to regroup.

Disney has left behind layers of support since its September bottom. The initial layer sits near the October/May highs. A drift back down to this area, which runs from $115.40 to $113.30, would offer investors a low-risk re-entry opportunity.

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Disclosure: This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.