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As you all know, earnings season is underway. There have been many leading stocks that have come under severe selling pressure after reporting earnings. The leading restaurant stock Chipotle Mexican Grill, Inc. (CMG) is one of the market leading stocks that sold off after reporting earnings. In fact, the stock topped out on March 21, 2014 at $622.90 a share. Today, CMG stocks is trading around the $490.00 level. Recently, the company cited higher food prices as a problem. Chipotle Mexican Grill Inc uses non-GMO (Genetically modified food) foods in most of its food items for sale and these food products are certainly more expensive.
Traders should note that CMG stock is oversold on the daily chart. This tells us that bounces could occur at anytime in the near term, but the daily chart trend remains down and lower stock prices are very likely. Traders should watch the $449.00 level as major daily chart support. This is an area where CMG stock should be supported by the institutional money and possibly be a solid bottom.