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Beyond Meat Stock Could Make New Lows Despite KFC Launch

Beyond Meat stock is teetering on a key support level. If it fails, new lows could be on the way.

Beyond Meat  (BYND) - Get Beyond Meat, Inc. Report stock was ripping higher on Wednesday. Shares were up about 7% near the open but topped just minutes after trading began.

The stock is now slightly lower on the day, after falling more than 12% from peak to trough over the last three sessions.

It’s just as well, as the chart continued to flash caution for traders.

Initially, Beyond Meat stock was on the move due to Yum Brands’  (YUM) - Get Yum! Brands, Inc. Report KFC unit rolling out Beyond Chicken products.

But Wall Street doesn’t seem interested.

That was the case back in mid-October too, involving McDonald’s  (MCD) - Get McDonald's Corporation Report.

The reality is, Beyond Meat is considered a growth company and growth stocks are getting annihilated at the moment, regardless if there’s good news or not.

It doesn’t help that the company reported disappointing earnings in November and has yet to recover.

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Trading Beyond Meat Stock

Weekly chart of Beyond Meat stock.

Weekly chart of Beyond Meat stock.

Back in July, the stock fell hard from a multi-month high, falling hard in eight out of nine sessions. Ever since that stretch, Beyond Meat stock simply hasn’t been able to recover.

Amid that fall, Beyond Meat fell into a painful downward channel and the stock has now declined in six straight months since (and is working on a seventh).

When the company reported earnings, the stock broke below that channel — man, it was already bad enough! — and began to find prior channel support as resistance.

That’s what I meant at the top of the article when I said, “the chart continued to flash caution for traders.”

From here, the $62 level is proving important.

We had a “look below” this level, but failed to break below it. That will have some aggressive traders long from $62.06 — the December low — with a stop just below this week’s low at $60.42.

If Beyond Meat stock can rotate higher, let’s see it can clear downtrend resistance. That will be a big development if it can, putting the declining 10-week moving average in play, followed by $75 to $77.

On a break below $62, there’s a chance that long-term uptrend support could give the stock a bounce (blue line). But more cautiously, I would have my eye on the 2020 low near $48 and the all-time low near $45.

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