Double Upgrades, Crude Oil Slips Lower, and Defying Gravity

Double Upgrades

Shares of Cigna (CI) are trading higher in a lower market as the company got a double upgrade from Wall Street this morning. Analysts from Cantor Fitzgerald and RBC Capital Mkts upgraded the insurance provider to a “buy” as the stock is breaking through a “Double Top” technical formation.

CI shares are also preparing to break through a longer “Double Top” pattern that dates back to 2022, meaning the stock’s momentum is about to accelerate.

Crude Oil Slips Lower

Despite the geopolitical pressures in the Middle East, crude oil (USO) prices are slipping lower and preparing for what I refer to as a “Volatility Storm.”

Last week, we heard about the United States’ production outpacing OPEC as domestic producers are getting more efficient with fewer holes in the ground. That’s bad for oil prices and good for a short list of producers.  We’ll look at one of them Wednesday.

Defying Gravity

Talk about a Walk Down Main Street Stock… Chipotle (CMG) shares have become one of my favorite long-term holdings, but the stock is due for a pullback.

Shares of CMG are defying gravity right now as the stock trades at overbought conditions just above $2,500 per share.

Keep the following in mind. Chipotle will announce their earnings tomorrow after the close. I expect that they will post some great numbers, but the stock is “Priced for Perfection.” That means we’re due for a pullback.

Here’s the surprise I think we could see. At $2,500 a share, Chipotle needs a manmade pullback to make shares seem cheap. I think there’s a good chance that management will announce a stock split tomorrow, which will make the stock seem cheaper and attract more buyers.

Add this stock to your long-term buy list if you don’t already own it.

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About the Author

Chris Johnson (“CJ”), a seasoned equity and options analyst with nearly 30 years of experience, is celebrated for his quantitative expertise in quantifying investors’ sentiment to navigate Wall Street with a deeply rooted technical and contrarian trading style.

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