Stock of the day: Starbucks

I guess many things were already said about the recent Russian push towards an invasion. Maybe let’s not repeat the same things and get straight to the point – an analysis of Starbucks. The situation on the chart is negative and this is our outlook for the stock, however, the rapid reversal on stocks that we see today, may change this situation soon. But don’t worry, we will tell you, where the bearish sentiment will end.

Starbucks has been dropping since the beginning of the year. The price finally managed to complete the Head and Shoulders pattern (yellow) and break its neckline (red). That created a technical sell signal and the price obeyed. The bearish sentiment was significant enough to break the 38,2% support level (blue), which looked strong but now it serves better as a resistance, stopping any bullish reversal attempt.

As long as the price stays below the 38,2% level the sentiment is bearish. The price coming back above that level will cancel the negative sentiment and give us a buy signal. Chances for that are now limited but we have to be careful as during times like this markets tend to behave weirdly.