Yesterday, leading fast food restaurant stock Chipotle Mexican Grill, Inc. (NYSE:CMG) sold off after announcing Q2 guidance. Despite the stock price falling sharply lower on yesterday’s news the stock actually peaked out on May 16, 2017 at $499.00 a share. Today, CMG stock trades at $416.00 a share. Many traders are now wondering if the stock is cheap, but unfortunately it should trade lower according to the charts.
Traders and investors should note that the stock was defended in March 2017 at around the $394.00 level. This should be the next major support area for CMG stock when it is retested. At this stage of the game the stock should have the selling momentum to test that key support level.