Beyond Meat Stock: How to Trade After Earnings Report

Beyond Meat stock is rallying ahead of the numbers. Here's how to trade Beyond Meat once its earnings are out.
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Beyond Meat  (BYND) - Get Report shares are sizzling a bit ahead of its earnings report after the bell.

The El Segundo, Calif., plant-based-meat producer won’t be the only stock on investors’ radar, though, with Disney  (DIS) - Get Report, Activision Blizzard  (ATVI) - Get Report, Electronic Arts  (EA) - Get Report and Pinterest  (PINS) - Get Report, among others, reporting earnings as well.

Beyond Meat shares were hammered amid the coronavirus selloff. Before the pandemic, the shares were bubbling below $130 resistance and looking for a breakout. The selloff cut the stock down by more than 60% from the February high.

With the shares now back to $100 ahead of the news, investors are left in a tricky spot. Will the shares rocket back up toward resistance or pull back a bit as they have now doubled from the lows?

Let’s examine the charts.

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Trading Beyond Meat Stock

Daily chart of Beyond Meat stock.

Daily chart of Beyond Meat stock.

Earnings can be the catalyst that ignites the move higher - or they can destroy the setup. 

If it weren’t for the pending earnings report, Beyond Meat stock would have a great-looking chart.

The shares rallied hard up to the declining 200-day moving average and 78.6% retracement for the 2020 range.

With the help of some downgrades along the way, Beyond shares pulled back to the 20-day moving average and 50% retracement, before bouncing on Monday. If it weren’t for earnings, the bulls would be looking for a continued move up to resistance.

With earnings in play, we must consider the possible move in both directions.

On the upside, I want to see whether Beyond Meat stock can clear $117. If it can, it puts it over multiple layers of resistance and puts a test of $130 resistance in play. Over that and $160 is a longer-term upside target.

Should Beyond Meat shares move lower on the report, I want to see whether they can close above recent support, which is the 20-day moving average and 50% retracement.

Below that puts the 50-day moving average and 38.2% retracement in play, along with uptrend support. If those levels fail, the $72.50 mark is on the table.