The charts of drive-through coffee chain Dutch Bros (BROS) are looking weak. Traders are running out of caffeine and the indicators are looking weak.
Let's check.
In the daily bar chart of BROS, below, I can see a weak chart picture. Share prices are currently trading below the 50-day and the 200-day moving average lines.
The trading volume is too small to "read." The On-Balance-Volume (OBV) line shows weakness from the middle of February and appears to be leading the price action. The Moving Average Convergence Divergence (MACD) oscillator is bearish.
In the weekly Japanese candlestick chart of BROS, below, we have less than our normal three years of data. Prices are in a longer-term downward trend. BROS trades below the declining 40-week moving average line.
The weekly OBV line has been stalled since May. The MACD oscillator has improved from July but still remains below the zero line and a buy signal.
In this daily Point and Figure chart of BROS, below, I can see a potential downside price target in the $25 area.
In this weekly Point and Figure chart of BROS, below I see a possible downside price target in the $20 area.
Bottom-line strategy: Traders could be buyers of the coffee but they should avoid the long of the stock.
