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Fan Yang

Boston Beer Co. (SAM) Retreats: I Like $280-$300 As Support for Bullish Trend

Boston Beer Company (SAM), which makes Samuel Adams, has been bullish in 2019, breaking into all-time-highs even as the US-China trade-war escalated. But in the past couple of weeks, price finally started to retreat. But because the overall trend is bullish, and SAM shouldn't be materially effected by the trade-war, I think it is a candidate to buy-on-the-dip around $280-$300.

SAM Daily Chart

(click to enlarge)

Bulls in Charge:
- On the daily chart, we can see that price was consolidating in late 2018 and even dipped lower at the end of the year to almost $230. 
- Then, from this low, price has been bullish in 2019. It almost tagged $350 in May before retreating.
- Looking at the daily chart, we can also see that price is retreating from a fresh high, a sign that this is a correction while the primary trend is still bullish.
Support:
- There could be support in the $320-$325 area, which was a previous resistance area.
- Price is hammering down on this level at the moment. 
- A sharply bullish market might indeed find support here and continue north.
- However, we have see some strong correction swings since the second half of 2018 and even in 2019.
- If we expect a similarly significant correction we should anticipate more downside below $320. 
- The $280-$300 area involves 
1) the 200-day simple moving average (SMA).
2) a price gap that occurred after Q1 earnings was released. (https://www.zacks.com/stock/news/399212/boston-beer-sam-rises-on-q1-earnings-beat-strong-shipments)

3) a rising threndline support.
- If price indeed holds above $280, we might still see higher highs on a subsequent bullish swing.

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