Technical Setup: SPROUTS FARMERS MARKET INC (NASDAQ:SFM) Appears Poised for a Breakout.

Our stock screener has spotted SPROUTS FARMERS MARKET INC (NASDAQ:SFM) as a possible breakout candidate. A technical breakout setup pattern occurs when the stock is consolidating after a nice uptrend. Whether the actual breakout occurs remains to be seen of course, but it may be interesting to keep an eye on NASDAQ:SFM.

Analyzing the Technical Aspects

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.

We assign a technical rating of 10 out of 10 to SFM. Both in the recent history as in the last year, SFM has proven to be a steady performer, scoring decent points in every aspect analyzed.

• Both the short term and long term trends are positive. This is a very positive sign.
• When comparing the yearly performance of all stocks, we notice that SFM is one of the better performing stocks in the market, outperforming 97% of all stocks. On top of that, SFM also shows a nice and consistent pattern of rising prices.
• SFM is part of the Consumer Staples Distribution & Retail industry. There are 39 other stocks in this industry. SFM outperforms 97% of them.
• SFM is currently trading in the upper part of its 52 week range. The market is still in the middle of its 52 week range, so SFM slightly outperforms the market at the moment.
• In the last month SFM has a been trading in the 130.06 - 151.87 range, which is quite wide. It is currently trading near the high of this range.
• Prices have been rising strongly lately, it may be a good idea to wait for a consolidation or pullback before considering an entry.

Check the latest full technical report of SFM for a complete technical analysis.

How do we evaluate the setup for SFM?

ChartMill takes into account not only the Technical Rating but also assigns a Setup Rating to each stock. This rating, on a scale of 0 to 10, reflects the degree of consolidation observed based on short-term technical indicators. Currently, SFM exhibits a 7 setup rating, indicating its consolidation status in recent days and weeks.

SFM has an excellent technical rating and also presents a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. There is a resistance zone just above the current price starting at 148.32. Right above this resistance zone may be a good entry point.

Trading breakout setups.

For a potential trade one would typically wait until the stock breaks out of the consolidation zone to enter the stock and it could be sold again for a loss when it would fall back below the zone.

Of course, there are many ways to trade or not trade SFM 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.

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.