Earnings Play: PepsiCo

Bullish bias above Monday's opening gap.

Trader 3

On Thursday, before market, PepsiCo (PEP) is expected to release third quarter EPS of $1.49 compared to $1.56 last year on revenue of approximately $17.2 billion, in line with the year before. PepsiCo is an international beverage and food company, and its expected move based on front-month options is 2.7%. The last time the company reported earnings the stock rose 0.3%.

Technically speaking, on a daily chart, PepsiCo's stock price is currently holding above an opening gap from Monday, after price gapped up 1.9% from Friday's close. Looking back further it appears PepsiCo's stock price has been chopping around the 200-day simple moving average (SMA) in a consolidation range since April. The RSI shows upside momentum and is above its neutrality area of 50. As long as price can hold above the low from the opening gap day on Monday, which is 135.60, the bias should remain bullish. Price will likely retest its first resistance level of 141.00. If price can breakout to the upside of 141.00, traders should look for price to reach for 144.00. However, if price closes below the gap day low of 135.60, it would be a bearish signal that could cause price to fill the gap and fall back to 133.80. If price cannot find support and bounce off of 133.80, price could potentially continue its descent and hit 129.40.           

Source: GAIN Capital, TradingView

More from Earnings

From time to time, GAIN Capital Australia Pty Ltd (“we”, “our”) website may contain links to other sites and/or resources provided by third parties. These links and/or resources are provided for your information only and we have no control over the contents of those materials, and in no way endorse their content. Any analysis, opinion, commentary or research-based material on our website is for information and educational purposes only and is not, in any circumstances, intended to be an offer, recommendation or solicitation to buy or sell. You should always seek independent advice as to your suitability to speculate in any related markets and your ability to assume the associated risks, if you are at all unsure. No representation or warranty is made, express or implied, that the materials on our website are complete or accurate. We are not under any obligation to update any such material.

As such, we (and/or our associated companies) will not be responsible or liable for any loss or damage incurred by you or any third party arising out of, or in connection with, any use of the information on our website (other than with regards to any duty or liability that we are unable to limit or exclude by law or under the applicable regulatory system) and any such liability is hereby expressly disclaimed.