Hi friends, It has been a long time I haven't updated KHC idea. Since that time price action printed several signs of bottoming process is taking place. I have shown them on the chart. As mentioned in previous idea the day price opened with 30% gap down a big buyer (could be Warren Buffet ;) ) showed up and absorbed all the panic selling. It was a first and immediate sign beginning of accumulation process. Since then price hasn't moved higher but consolidated for significant time. Subsequent drop in price after accumulation and return with gap up is our second sign of bottoming process is real and in progress. It gave up a range of accumulation $27-$31.50. I believe price will keep accumulating within that range until it breaks up. The worst case scenario is double bottom pattern. The best case scenario is upward gap will be tested and holds without being broken down.
Any purchase within this range will be good for investment. Obviously try to get the lowest entry possible within this range. Good strategy is as usual split your entries into at least 5 and slowly scale in.
Good Luck!
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Ok we have got our anticipated drop. It happened a bit later than expected though. Today’s candle is good - shows support. It’s a good place to add to position or enter.
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Flat Eve-like second bottom of double bottom pattern might have been printed today. I anticipate rally in overall stocks and stock indexes until end of the year to start any day now. It should take KHC stock with it.
Anyway accumulation was quite lengthy and KHC is ready to come back and close that 30% gap.
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Everything according to plan with KHC. It came to that gap at 29.xx to go over it, so rally continues - no worries. Double bottom is more defined now.
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Finally it breaks out. Accumulation is done I think.