This stock had been a monster, but that all could change quickly here. After a monster gap up in March, MNST has done little. For quite a while, it looked like the bulls were merely consolidating. Bollinger bands tightened and then the stock pushed higher toward the end of April, but now we have a problem.
A gap down in May has left us with a very bearish taste in our mouths. An island top of sorts is now left on the chart, and we still have a gap left to fill in both directions. Unfortunately for the bulls, the gap lower to $125 looks like it will be filled in the next few days, with $122 possible.
This looks like it has the potential to be a much bigger move to the downside. I wouldn't write off the potential for a revisit of the $115 level here. We are consolidating price in the style of a bear flag with confirmation from the RSI and slow stochastics. Momentum and trend are bearish and getting more so. Price acceleration to the downside is absolutely possible here. Until MNST pushes back over $134, I have no interest in being long. For those looking to play the long side, buying here with a target of $132 and a very tight stop is the game. I have no interest in that one.