Is CMG ready for a PULLBACK?

26 Nov 2023

CMG Year to date Chipotle is on an absolute tear. As of writing this post, it is up 58% YTD totaling +$848 per share.

Due to its share price, it has a low daily trading volume and wide bid-ask spread making it a more risky trade.

Since 10/25/23 it has been on a straight line up after retesting the 200-day moving average.

RSI is currently at 80.77 showing it is likely overbought.

Currently hitting the top of a 3-month rising wedge.

With all the issues in the macro, we are likely due for a significant pullback. Once the general public realizes our economy is deflating and the middle class continues to get clobbered we are likely setting up for a nasty pullback in the market.

With a business model revolving around the middle class with no truly inexpensive menu items, it will be a challenge to see the continued increase in same location sales.

I will be a large put buyer at the next negative divergence!