McDonald’s now facing resistance ahead

MCD daily chartThe daily chart for McDonald’s makes interesting reading and continues to remain bullish as I mentioned in a previous post on this stock and as confirmed with the volume on both Thursday and Friday last week. Thursday’s price action saw the stock move lower, only for it to recover during the session and close higher on the day on excellent buying and a strong signal of intent to move higher on this buying. Friday opened gapped up on good volume with the stock closing the week $186.10.

However, further advancement for this stock is likely to be harder, given the two strong areas of resistance now immediately ahead at $193 and $197 respectively. Each is strong in its own right, but together they constitute a serious area of resistance and denoted with the red and blue dashed lines of the accumulation and distribution indicator. The thickness of the line describes the strength of each area and is calculated automatically by the indicator and is likely to present a solid barrier and defence of the $200 per share price. Given the strength of this resistance, it will take excellent volume to drive through this region.  Meantime, the trend monitor continues to confirm the bullish picture and should the $200 be attained the stock will have a solid support platform for the next move leg higher.

By Anna Coulling

Charts from NinjaTrader and indicators from Quantum Trading

About Anna 2016 Articles
Hi – my name is Anna Coulling and I am a full time currency, commodities and equities trader. I have been involved in both trading and investing for over fifteen years and have traded many different financial instruments, from options and futures to stocks and commodities. I write and publish articles ( mostly for free ) for UK and international publications on a wide variety of financial issues, and in particular I enjoy helping others learn how to invest and trade.

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