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Fan Yang

Starbucks (SBUX) Breakout Needs to Clear $60.15

Starbucks $SBUX has been in correction mode the first  half of the year, but made a persistent recovery since hitting a low of $48 at the end of June.

SBUX Daily Chart

(click to enlarge)

Cracking Trendline Resistance:
- We saw price attempt to break above the falling resistance a couple of weeks ago. 
- Then it fell but was able to hold above $55. This support was a strong signal that price might eventually break through the resistance.
- The V-shape reversal that followed also suggests pressure is mounting on the falling resistance.
- Furthermore, note that price held above the cluster of moving averages (200,100,50), and the RSI held above 40. All signs that bulls are in control.
- Still price has only cracked the trendline. I think a break above common resistance around $60.15 will be necessary to open up the market to higher highs, and eventually the 2018-high around $65. 
Bullish Continuation:
- If price can make it back up to $65, I would expect further upside outside of some short-term resistance. 
- The weekly chart shows SBUX in a persistent uptrend. We should not expect the pace of rally to remain so high, but if price can make it back up to $65, it is likely going to continue the uptrend, albeit probably at a slower pace.