Restaurant Brands International Inc. owns, operates, and franchises quick service restaurants under the Tim Hortons and Burger King brand names. It operates through two segments, Tim Hortons and Burger King. As of January 27, 2017, Restaurant Brands International Inc. franchised or owned 19,000 restaurants in approximately 100 countries and U.S. territories worldwide. The company serves as the sole general partner of Restaurant Brands International Limited Partnership.
Take a look at the 1-year chart of Restaurant Brands (NYSE: QSR) below with my added notations:
QSR has trended consistently higher throughout the past year. Recently, the stock has created a 52-week high resistance level at $50 (red), while also climbing a short-term trendline of support (green). At some point, QSR is going to have to break one of those two levels.
Join our new Linkedin Group by clicking the link below:
The Tale of the Tape: QSR trades between a trendline support and a $50 resistance. A long trade could be made on a pullback down to the trendline, or on a break through $50, with a stop placed below the level of entry. A break below the trendline could be an opportunity to get short the stock.
Before making any trading decision, decide which side of the trade you believe gives you the highest probability of success. Do you prefer the short side of the market, long side, or do you want to be in the market at all? If you haven’t thought about it, review the overall indices themselves. For example, take a look at the S&P 500. Is it trending higher or lower? Has it recently broken through a key resistance or support level? Making these decisions ahead of time will help you decide which side of the trade you believe gives you the best opportunities.
No matter what your strategy or when you decide to enter, always remember to use protective stops and you’ll be around for the next trade. Capital preservation is always key!
Christian Tharp, CMT
Follow me on Twitter: @cmtstockcoach