Starbucks has been on the decline since peaking in early April, and while the chart seems to portray a vicious downtrend it is only down about 10% from those highs. Certainly not a performance to be proud over, but now it appears the stock may have found support at 55 and is ready to rise up again.
There is a higher low on the chart from the June low, a good start. Monday’s action was constructive, with strong turnover and heavy option flow (specifically Nov 57.5 call strike). The MACD is turning up and while it’s a bit early to call a buy signal, with a couple more days it’ll be in view. Resistance is certainly in place above here with the 57-58 level looming large (arrows). However, we see that momentum is starting to pick up and the strong buying impulse could move this stock up in a hurry.
