The $300 level has proven psychologically significant for McDonald’s (MCD) stock:

→ In summer 2023, bullish investors failed to push the price above this mark, leading to a decline from $298 in July to $246 by October.

→ Again, in January 2024, the price briefly surpassed $300 but quickly dropped, eventually falling to $245 by July.

This autumn, it appeared the level had been breached when an uptrend (highlighted by the blue channel) lifted MCD above $315. However, reports of customer food poisoning incidents hit the news, causing MCD’s stock to plummet to $295 on October 23, making the orange channel more prominent in the technical analysis.

Analysts have subsequently downgraded McDonald’s ratings:

→ Guggenheim’s Gregory Frankfort downgraded MCD from “Buy” to “Neutral” on October 23, setting a target price of $285.

→ Baird’s David Tarantino followed suit, lowering his rating from “Outperform” to “Neutral” and adjusting his price target from $320 to $290.

Will MCD stock be able to reclaim the $300 mark? Much hinges on the company’s earnings report due out today, with analysts forecasting:

→ Quarterly earnings of $3.20 per share, a slight rise from last year’s $3.19 per share.

→ Quarterly revenue at $6.82 billion.

If investors react negatively to the report, it could push MCD below the critical $300 level and trigger a bearish break in the uptrend established since July.

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