Vita Coco Seems to Be Leaving a Bad Taste in Investors' Mouths
There's reason to expect losses for the coconut water brand.
You've reached your free article limit
You've read 0 of 1 free Pro articles.
The Vita Coco Company COCO mainly sells coconut water. I see it in every bar down here in lower, slower Delaware (but don't ask how many bars I have visited). Some of the local bartenders are very creative in using it within cocktails and mocktails.
But let's separate the popularity of a product and the performance of the stock. Time to shake up the charts.
In this daily bar chart of COCO below, I can see that prices have rolled over the past 10 months. Every rally to the $31 area and higher has failed. Prices have crisscrossed the 50-day moving average and the 200-day line. The trading volume is neutral but the On-Balance-Volume (OBV) line shows weakness since November. The Moving Average Convergence Divergence (MACD) oscillator is slightly below the zero line.
In this weekly Japanese candlestick chart of COCO below, I can see that we do not have our full three years of price history. In this chart, we can also see how prices have struggled in the $30 to $32 area. COCO is testing the 40-week moving average line which only has a very slight positive trend. The weekly OBV line has been weak the past 12 months. The MACD oscillator is slightly above the zero line and pointed lower.
In this daily Point and Figure chart of COCO below, I can see a downside price target in the $23 area.
In this weekly Point and Figure chart of COCO below, I can see a $21 price target.
Bottom line strategy: Shares of COCO have failed to move higher many times in the past year, so it looks like the path of least resistance will be to the downside.
Employees of TheStreet are prohibited from trading individual securities.