Beyond Meat Inc. (BYND) has made a strong and impressive rally in a relatively short period of time. My wife and I have tried the product and we've been impressed.
Trends, however, can have corrections and reversals despite positive press and recommendations from Wall Street. Buying can be "clumpy" and markets can become overbought.
Let's look at two charts of BYND to see if a pullback could be looming ahead.
In the daily bar chart of BYND, below, we can see an uptrend over the past three months. Trading volume was heavy in May and June but it has diminished in July.
The daily On-Balance-Volume (OBV) line shows a bullish rise the past three months as buyers of BYND have been more aggressive. Prices got overbought in July using the slow stochastic indicator. A push to new price highs in the days ahead is likely to generate a bearish divergence as the slow stochastic indicator is not likely to make a new high.
In this Point and Figure chart of BYND, below, we can see an upside price target of $227 being projected.
Bottom-line strategy: In the early years of my career in the securities' industry I found a saying that has stayed with me over the years: "Calling the market is easy - getting it to answer is hard." I think about that when I consider BYND. The stock could well push higher in the days and weeks ahead but the risk of a downward correction is growing and traders might want to consider booking some profits.