Starbucks (SBUX) Tests Key Level, Watch Out If It Breaks

President & CEO Chief Market Strategist at IntheMoneyStocks.com • Jan 30, 2020 at 3:22 PM EST

This important moving average is major support and any weekly close below this level would likely trigger more downside for the coffee giant.

Leading restaurant stock, Starbucks Corp (Nasdaq: SBUX), has been falling sharply since January 24, 2019. At that time, SBUX was trading as high as $94.13 a share. Since that high pivot, the stock has declined to $84.98 a share. Traders should note that the stock now testing its 50-week moving average. This important moving average is major support and any weekly close below this level would likely trigger more downside for the coffee giant. Starbucks has significant exposure to China and has announced that they will temporarily close half of its stores in China amid the Coronavirus outbreak. The next major support level for SBUX will be around the $75.00 level. This is where the stock broke out in June 2019. Often, past breakout levels will serve as major support when retested.

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