September 22 Chart of the Day - Darden Restaurants
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Darden Restaurants, Inc. (DRI) reported Thursday that it surpassed projected earnings in spite of less than spectacular fine dining sales. Today its stock price is trading down.
You may be familiar with one or more of their restaurants: Olive Garden, LongHorn Steakhouse, Yard House, Ruth's Chris Steak House, Cheddar's Scratch Kitchen, The Capital Grille, Seasons 52, Eddie V's and Bahama Breeze.
On the monthly chart, price is well off its $173.06 all time high (ATH) set this past summer and has retreated back towards price structure on the chart. (As an aside, wouldn't you have hated to be the one who bought $173.06... at least for now?)
The weekly chart provides greater insights into potentially actionable levels in both directions.
Price seemingly is gravitating back down towards a "change control zone" between $125-$130 area.
Change control zones are one of the five price action tools we teach when charting anything. By definition, they are an area that represents where neither the bulls nor bears are in charge. Price can slash though the zone with seemingly reckless abandon, price can respect the top or bottom from outside it or within it. Or, price can trade aimlessly sideways within it. When price breaks away from the zone it can often get drawn back to it like a magnet. And in this case we see all of the above are true.
Ultimately, we are neither bears nor bulls. We are traders that seek to identify bi-directional levels of interest to create actionable trade plans.
So what's next?
We don't make predictions...
Nobody knows for sure but using these 5 price action tools traders and investors can develop levels of interest in both directions.
- Support/Resistance
- Trend
- Fibonacci
- Supply/Demand Zones,
- Change Control Zones
Take a look at the charts and let us know what you think.
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