Trading Updates on Chipotle CMG Feb 23

What’s Chipotle (CMG) shares up to now? What opportunities exist to trade them?

Let’s start with the Daily Chart, note the key levels, and plan from there:

The E.coli scare sent investors fleeing the stock, resulting in a collapse from $750 to $400 per share.

It’s possible if not likely that Chipotle (CMG) shares bottomed (reversed) off the $400 level and are in rally/reversal mode into early 2016.

Price reversed strongly up over 25% from the early January low, targeting the underside of the 38.2% Fibonacci Retracement level (highlighted).

For trading tactics right now, shares are “breakout bullish” on an eventual trigger breakout above $535; are Neutral (unbiased) within the $500 to $535 per share highlighted range; and breakdown bearish under the $500.00 per share price and EMA support line.

Here’s the large perspective pulled back to the Weekly Chart of the reversal(s):

Chipotle was a darling stock for many months and even years, ending the uptrend glory with the bearish reversal at the $75.00 per share peak mid-2015.

From there, the share price collapsed, losing half its value into the early 2016 low.

Just like the Daily Chart, the Weekly Chart ALSO shows a Neutral Range Compression Zone at the same levels:  $500.00 for support and $535 for resistance.

There’s no main trade here until price breaks through one of these barrier (pivot) levels.

Under $500, look to trade for a retest of the $400 low; on a breakout look to play bullishly toward $575.

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Corey Rosenbloom, CMT
Afraid to Trade.com

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