Fevertree shares hit major problem at this price
Despite last week's stunning rally, Fevertree remains at risk of a 28% share price plunge. Here's why.
28th January 2019 09:42
by Alistair Strang from Trends and Targets
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Despite last week's stunning rally, Fevertree remains at risk of a 28% share price plunge. Here's why.
Fevertree Drinks
This lots share price is all over the place. When we last reviewed Fevertree Drinks (LSE:FEVR) back at the end of November we'd an expectation the price intended a drop. The price managed confuse the issue, confirming the criteria for a drop, then triggering the criteria for a rise – which it met. However, we still suspect it intends a reversal.
As the chart shows, the share price briefly regained the big picture uptrend (in red on the chart below) for the best part of a day, then was trashed the next day.
The situation now is slightly uncomfortable as weakness below 2,590p expects a visit to 2,471p. At this point, there's a fairly major problem thanks to closure below 2,471p indicating the potential of future travel down to 1,923p.
Visually, there's a major issue at the 1,923p level. The price will achieve a lower low, having broken the long-term uptrend. Worse, it will find itself solidly in a region where "bottom" calculates at 1,142p eventually.
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On the subject of visual cues, it's pretty obvious a glass ceiling exists at the 3,000p level.
If the current drunken stagger through share price positions intends to redeem itself, there's a pretty solid promise the share need only better 3,004p to enter a cycle to an initial 3,310p. Secondary, if bettered, computes at a longer term 3,711p. At such a level, we will need revisit the numbers.
Alas, for now, we must regard it as heading to 2,471p and hopefully bouncing again, next time properly and capable of closing a session above the red on the chart.
Source: Trends and Targets Past performance is not a guide to future performance
Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.
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