SBUX Watch: Technicals turn bearish

The dudes who killed the 25¢ cup of (really bad) coffee, Starbucks Corp. (SBUX), is showing severe technical deterioration after an 18% run-up to $28.50 from the May 25 low of $24.07.

	trend	adx	psar	pps	macd	macd trend	sto	sto trend
SBUX $26.80

The parabolic sar moved into bear mode today. So did the macd. Person's Proprietary Signal turned bearish on Tuesday. The stochastic has plunged below the 20-line into what is called oversold territory but which is a bear signal until the 20-line is crossed again on the way up.

The price has declined from the prior close for three out of four days this week and is 6% below the swing high.

Today's decline puts the price back to the June 10/11 levels, the point at which the price broke above previous very near term resistance.

Reversal Levels

• $28.50, +6.3%
• $26.80 <== You are here.
• $25.20, -6.0%

The recent rise was sharp enough to give SBUX plenty of room to decline before it hits support.

Long term, SBUX peaked at $40.01 in November 2006, declined to $7.06 in November 2008, and has mainly been on the rise since then. The recent near-term signals must count as a short-term counter-trend within a long-term uptrend.

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Disclaimer

Tim Bovee, Private Trader tracks the trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment. No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decision decisions for his or her own account, and take responsibility for the consequences.

Abbreviations:

• psar - Parabolic Stop and Reverse
• adx - Average Directional Index
• pps - Person's Proprietary Signal
• ma20 - 20-day moving average
• macd - Moving Average Convergence-Divergence
• sto - Fast Stochastic

About the glance: The colors indicate the state of each signal.

• trend: Determined by the 5-day moving average, green for up, red for down, yellow for sideways
• adx: orange for above 30-up, blue for 20-down, purple for in the middle. Red is most prone to whipsaws
• psar, pps, macd: green for bull mode, red for bear
• sto: green for overbought, red for oversold, yellow for the neutral zone.