07Oct10:32 amEST

They're Getting Beat Making a Run for the Border

In the wake of Yum! Brands taking it on the chin after earnings, with China concerns a major drag, it is worth noting that the Taco Bell owner hd already bee sporting a very steep up-trending must-year chart. 

The monthly chart for YUM, below, illustrates that point, as the stock has been in a strong uptrend since the turn of the century. 

Therefore, the idea that this latest earnings report or even changing consumer tastes represent the catalyst is likely misguided. In fact, those issues are much more likely to be an excuse to correct a steep long-term trend. As an example, Yum! is very likely to make adjustments in the coming quarters and beat fast casual with better price points. Hence, the focus on the chart dynamics is important. The move over $90 was likely buyer exhaustion and should mark a top in place for the foreseeable future.  

For now, YUM is in the process of breaking that steep trend, and may take a while to keep correcting and then repairing. 

I expect the same from other steep long-term trends for multinationals, which we have been noting and trading for Members on the private Twitter feed. 

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