Chipotle Mexican Grill (NYSE: CMG) has been able to adapt within the current pandemic situation by adjusting its operations to handle digital orders and and made deliveries.
Last week , the stock hit a record high, going over $1,000 per share for the first time and it’s currently up 125% since the March bottom. The technical outlook for CMG was strongly bullish since last year as CMG rallied into new all time highs by breaking above 2015 peak which created a bullish sequence with a minimum target at $965.
The impulsive 5 waves advance since IPO was the key for the stock to remain supported and looking for a similar path to the upside after taking 2015 peak to refresh the bullish trend. Consequently, CMG is currently looking for a similar path to take place from 2018 low as the stock is trading higher within a strong 3rd wave within the Grand Super Cycle.
Chipotle Mexican Grill – CMG – Monthly Chart
Based on Elliott Wave Theory, after every 5 waves advance, a correction in 3 waves takes place before the resumption of the main trend which is the main reason the market doesn’t run within a straight line. Currently, the rally which started back in March 2020 is aiming for an initial target at equal legs area $1103 – $1266 which can see Bulls taking profit causing a 3 waves pullback in a potential wave II of (III) before the stock will find buyers again to be able to resume the rally.
The Mexican-food restaurant chain bullish structure is providing an edge for investor and allowing traders to join the trend during Daily pullbacks as long as $415 will remain in place. The next correction will be so important for the stock to define the next key levels to trigger more momentum into the weekly cycle.