Stock of the day: McDonald’s

In today’s talk of the day, let’s analyze McDonald’s, which has been navigating a significant technical setup in October and November. The stock experienced a false breakout above the key horizontal resistance at the $300 psychological barrier, marked with orange. This level has been a critical battleground for buyers and sellers, acting as a magnetic price point.

In October, McDonald’s initially broke above the $300 level, creating a false breakout highlighted in yellow. However, this breakout lacked follow-through, and the price fell back below the resistance, signaling weakness. In November, the stock retested the $300 level, but once again, sellers defended the resistance, leading to another pullback.

Currently, the price is hovering near this crucial resistance again, underscoring its importance as a key level to watch. The $300 level continues to act as a psychological magnet, drawing the price back toward it repeatedly.

The current setup offers two clear scenarios:

1. Bearish Case: As long as the price remains below the $300 resistance, the sentiment stays negative. Sellers maintain the upper hand and have the opportunity to drive the price lower.
2. Bullish Case: A daily close above the $300 mark would signal a breakout and a potential buy opportunity, with the possibility of new highs on the horizon.

Source: https://www.axiory.com/analytics/stock-of-the-day/stock-of-the-day-mcdonald-s-3-1