Is YUM CHINA HOLDINGS INC (NYSE:YUMC) Ready to Break Out of Its Range?

Our stock screener has identified YUM CHINA HOLDINGS INC (NYSE:YUMC) 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 NYSE:YUMC.

Technical Analysis Observations

ChartMill assigns a proprietary Technical Rating to each stock. The score is computed daily by evaluating various technical indicators and properties. The score ranges from 0 to 10.

We assign a technical rating of 7 out of 10 to YUMC. In the last year, YUMC was one of the better performers in the market. There are positive signs in the very recent evolution, but the medium term picture is slightly mixed.

• The long and short term trends are both positive. This is looking good!
• YUMC is currently trading in the upper part of its 52 week range. The S&P500 Index is also trading in the upper part of its 52 week range, so YUMC is performing more or less in line with the market.
• In the last month YUMC has a been trading in the 44.71 - 50.62 range, which is quite wide. It is currently trading in the middle of this range where prices have been consolidating recently, this may present a good entry opportunity, but some resistance may be present above.
• When comparing the yearly performance of all stocks, we notice that YUMC is one of the better performing stocks in the market, outperforming 83% of all stocks. However, this overall performance is mostly based on the strong move around 4 months ago.
• YUMC is part of the Hotels, Restaurants & Leisure industry. There are 135 other stocks in this industry, YUMC did better than 69% of them.
• Volume is considerably higher in the last couple of days.

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

How do we evaluate the setup for NYSE:YUMC?

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, NYSE:YUMC exhibits a 9 setup rating, indicating its consolidation status in recent days and weeks.

YUMC 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 50.41. Right above this resistance zone may be a good entry point. There is a support zone below the current price at 47.16, a Stop Loss order could be placed below this zone. Another positive sign is the recent Pocket Pivot signal.

How can NYSE:YUMC be traded?

One way to play this would be to wait for the actual breakout to happen and buy when the stock breaks out above the current consolidation zone. A possible place for a stop loss would be below this zone.

Please note that this article should not be construed as trading advice. The information provided is solely based on automated technical analysis and serves to highlight technical observations. It is important to conduct your own analysis and make trading decisions based on your own judgment and responsibility.

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

Disclaimer

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.