Unappetizing Outlook For Jollibee Foods Corporation (JFC)

Most Filipino kids love the food, especially the Chicken Joy, at Jollibee. While the children in general love it, its owners, the shareholders, might not feel the same in the near future. Let me tell you why.

Well, from a technical point of view, the shares of Jollibee Foods Corporation or JFC in the Philippine Stock Exchange could face some more downside. As you can see from its daily chart above, JFC had broken down from a head and shoulders pattern and its 200-day moving average when it made a bearish breakaway gap last January 28. In a couple of occasions, the psychological PHP 70.00 level acted as a support to push it back to PHP 80.00. However, the neckline of the head and shoulders and the former support at its 200-day moving average prevented it from going higher. From then on, JFC weakened again and is now trading just below PHP 72.00.

By the looks of it, JFC's outlook will even be bleaker. If you measure the height of the head and shoulders pattern and project it downwards from the point of breakdown, you will get a downside target of somewhere below PHP 60.00. JFC, though, would like see the PHP 60.00 level as a support since it already acted as a resistance previously and was an area of interest as well. So since its downside target has not been reached yet, you could expect it to approach that level unless it is able to rally past PH peso 80.00.

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