On September 1, 2016, Craft Brew Alliance was trading at $19.41, we said the following:
“…we have the following downside targets:
- conservative: $12.57
- mid-range: $10.02
- extreme: $7.47
Although there is no assurance that the stock needs to decline to the referenced downside targets, any parabolic move must be watch closely as entropy will kick in at some point. In this case, we believe that the ascending conservative target is a lock.”
Since September 1, 2016, BREW declined as much as –38% to the $12 level on April 18, 2017, on an intraday basis. On April 7, 2017, we said the following:
“We don’t necessarily believe it but here we are, with BREW at a price of $13.15 and well within the range of the conservative downside target set at $12.57”"…”
Since April 7, 2017, BREW has increased by as much as +46%. Anyone contemplating a purchase of BREW, barring a takeover by another company, should consider the exceptional increase in 8 months as a warning to protects your profits.
Below we have charted the price action for BREW and suggest that if the 2016 peak is not exceeded then the April 2017 lows will be retested and possibly violated by as much as –24% or falling to as low as $9.31.