The casual dining sector was a place we flipped bearish on last weekend, starting with the Weekly Strategy Session and in a post I wrote on Sunday night (which you can see here).
Earnings have come and gone for some marquee names in the space, like Panera and Cheesecake Factory.
Looking at an updated daily chart of Panera, unless you were willing to take on the earnings risk you probably missed the short opportunity. However, we may very well have a “sloppy seconds” situation coming up for another short entry.
But it will require some patience in letting it play out, since the stock is currently at a high risk short entry below its lower daily Bollinger Band and, in effect, quite short-term oversold.
If this truly is a major topping out process, as you can see the stock has been sloppy and churning since April after a multi-year uptrend, then a retrace up to $176 (light blue line, indicating prior support levels which may now turn into resistance) before another rollover is the ideal entry. It does not always work out so beautifully, but that would be the setup to re-short if you think this earnings sell-off and messy chart pattern is not just another bear trap before we sprint higher.
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Chess, may I borrow your technical analysis geniusness please? ABX, island reversal forming or small bull flag with continued upside next week? What say you? Thanks much.