Chart of the Day: Resting at the Highs Is Nothing New for This Portfolio Holding
After a rally for the record books, the stock is simply taking a breather before its next move.
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That move in November by Dutch Bros BROS was simply stunning. All the bullish tendencies were there even before the massive spike following earnings.
What we saw with BROS back in the late fall period (September/October) was a long basing period. In technical parlance, building a base for a period of time is good digestion following a strong move and also tells us where support levels are located. We can identify these zones when prices penetrate but quickly bounce upward. This information is key and tells us buyers are interested at these levels if some investors decide to shed the stock.
Such is the case now for BROS, which is now in that consolidation phase as the stock works off a very strong bullish chart. Momentum is turning lower with Stochastics coming in, again not a problem as the stock is NOT coming down, just moving sideways. The heavy bullish momentum is wearing off.
Parabolic SAR (stop and reverse) in the top pane is still bullish (dots), while candles are blue as well, indicating strong bullishness from the GoNoGo indicator. All in all, we like the fact BROS has not sold off after a November rally for the record books.
We like BROS and rate it a two in TheStreet Pro Portfolio.
More Pro Portfolio:
- We're Locking In a Triple-Digit Gain for This Deeply-Overbought Name
- Weekly Roundup: After a November to Remember, What's in Store for December?
- Headlines for the Holidays: News That Speaks to the Pro Portfolio
At the time of publication, TheStreet Pro Portfolio was long BROS.
