Chart of the Day: This 'Upstart' Holding Is Making a Steady Move Above Resistance
The stock is slowly recovering the losses it suffered following recent earnings.
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Such is life for Dutch Bros BROS, which continues to move upward at a rather steady pace. The coffee chain just exceeded some resistance that was created following an earnings miss in early August. However, time is friendly as the stock bounced around good support levels but never really broke the reaction low following that earnings release.
In fact, Dutch Bros has made a series of higher highs, higher lows since late August — and that is our textbook definition of an uptrend. Supported by a strong MACD (moving average convergence divergence) signal and the parbolic SAR (stop and reverse) in bullish mode, the uptrend could continue a bit longer.
Stochastics are strong, hence the momentum can help drive the stock up further. Money flow has been weakening, however, so that indicator shows up in the bearish camp.
We realize the competition is heavy with Starbucks SBUX and their new hotshot CEO along with McDonald's MCD. Still, we liked what we heard from the company recently and believe growth is ahead for this upstart coffee chain.
We see this stock making a run to the recent highs above $40 in short order once the gap at $38 has been filled.
We like Dutch Bros and rate it a One in TheStreet Pro Portfolio, or "Buy Now."
At the time of publication, TheStreet Pro Portfolio was long BROS.
