The market is reacting positively to recent Papa John's headlines. From Papa John's confirms Starboard deal (Seeking Alpha)Papa John's International (NASDAQ:PZZA) confirms the $200M investment being made by Starboard Value. The activist hedge fund will also have an option to invest another $50M. In addition to Starboard CEO Jeff Smith jumping on the board, former Pinnacle Entertainment CEO Anthony Sanfilippo is being added as an independent director. Board statement: "Our agreement with Starboard concludes a comprehensive strategic review conducted over the past five months to better position Papa John’s for growth, improve the Company’s financial performance and serve the best interests of our stakeholders. This transaction provides the Company with financial resources and strong and experienced directors on the Board in order to position the Company for success over the long term."...(seekingalpha.com)PZZA Daily Chart(click to enlarge)Flattening?- PZZA rallied sharply to start the 2/4 session.- We can see that price is essentially respecting the $37.45-$40 support area again. - This is indeed a critical support going back to 2014. - A break below $37 might send PZZA diving lower. - BUT, we have good news, and the market is defending this support area so far. - So, we can say that PZZA is possibly shifting from its prevailing bearish trend to at least a sideways one. - In a sideways market, we can see upside back to a common support/resistance pivot around $55, and maybe even the $60 resistance pivot from November.- A break above $60 would suggest a bullish market, but for now, we can only say that PZZA is shifting from bearish to bearish-neutral. - Earnings is due end of the month on 2/26 according to nasdaq.com. - I think PZZA will have some short-term upside due to the hype, but the $55, $60 resistance levels will likely prove too strong to break above.- At the same time, we might be able to have more confidence on the support around $40, unless the overall market goes into another sharp contraction that would drag PZZA down with it.