Technical Setup: STARBUCKS CORP Appears Poised for a Breakout.

Our stock screener has identified STARBUCKS CORP (NASDAQ:SBUX) as a potential breakout candidate. This technical breakout setup pattern occurs when the stock consolidates after a strong uptrend. While the actual breakout is uncertain, it may be worth keeping an eye on NASDAQ:SBUX.

What is the technical picture of NASDAQ:SBUX telling us.

ChartMill assigns a Technical Rating to every stock. This score, ranging from 0 to 10, is updated daily and is determined by evaluating multiple technical indicators and properties.

Overall SBUX gets a technical rating of 8 out of 10. This is due to a decent performance in both the short and medium term time frames. Compared to the overall market, SBUX is only an average performer.

• Both the short term and long term trends are positive. This is a very positive sign.
• SBUX is currently trading near its 52 week high, which is a good sign. The S&P500 Index however is also trading near new highs, which makes the performance in line with the market.
• In the last month SBUX has a been trading in the 94.78 - 103.32 range, which is quite wide. It is currently trading near the high of this range.
• When compared to the yearly performance of all other stocks, SBUX outperforms 51% of them, which is more or less in line with the market.
• SBUX is part of the Hotels, Restaurants & Leisure industry. There are 135 other stocks in this industry, SBUX did better than 45% of them.

Our latest full technical report of SBUX contains the most current technical analsysis.

How do we evaluate the setup for NASDAQ:SBUX?

ChartMill incorporates a Setup Rating in its analysis, which measures the extent of consolidation in a stock over recent days and weeks. This rating, ranging from 0 to 10, is updated daily and takes into account multiple short-term technical indicators. The current setup rating for NASDAQ:SBUX is 8:

SBUX has an excellent technical rating and also presents a decent setup pattern. Prices have been consolidating lately. A pullback is taking place, which may present a nice opportunity for an entry. There is a resistance zone just above the current price starting at 102.50. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 100.87, a Stop Loss order could be placed below this zone.

How can NASDAQ:SBUX be traded?

One strategy to consider is waiting for the actual breakout to occur, where the stock breaks out above the current consolidation zone. Traders can then enter a buy position, anticipating further upward momentum. As a risk management measure, it is advisable to set a stop loss order below the consolidation zone.

Of course, there are many ways to trade or not trade NASDAQ:SBUX and this article should in no way be interpreted as trading advice. The article is purely based on an automated technical analysis and just points out the technical observations. Always make your own analysis and trade at your own responsibility.

Every day, new breakout setups can be found on ChartMill in our Breakout screener.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.