Neat Dr Pepper Stock can make another jump soon

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Since their all-time high of $41.31 on Aug. 18, Keurig Dr Pepper (KDP) stock has been cooling. It fell to the $37.50 level before making a short jump back to the 20-day moving average. While this trendline eventually rejected the rally attempt, security has once again found some padding at the aforementioned $37.50 mark. There could also be an additional layer of support, in the form of a historical bullish trendline that just flashed on the charts.

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According to a survey by Schaeffer’s Senior Quantitative Analyst Rocky White, KDP came in just within one standard deviation of its 160-day moving average after a long journey here. The drink stock has seen five similar signals in the past three years, with one-month positive returns on 80% of these signals and a population average of 4.4% over that period. From its current position at $37.50, a similar move would bring equity to $39.15, removing the recent hurdle to the 20-day moving average.

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The stock continued to outperform the broader market relatively, with a small year-to-date lead and a year-over-year gain of 5.7%. This could lead to a round of analyst upgrades, especially given that five out of 10 in coverage call KDP a “hold.”

A decline in pessimism among options traders could also contribute to some tailwind for the stock. On the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), KDP has a 10-day put/call volume ratio of 2.28, which is above all but 1% of readings. of the past 12 months. In other words, puts were rarely more popular among these traders during this period.

Finally, the 14-day Relative Strength Index (RSI) of Keurig Dr Pepper stock is at 34, just on the verge of oversold territory. This could indicate a short-term bounce for the drink name.