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Food for Tought: Wendy's (WEN)

By David Randolph · May 1, 2005 · 1 min read · 289 views

Wendy's International, Inc.(WEN). The Group's principal activities are to operate, develop and franchise quick-service and fast-casual restaurants.

When I turned on my market filters and explorers and started to analyze hundreds of charts I knew I had to buy at least one food related stock. That's because I got a lot of stocks of this group making or attempting to make new highs with heavy volume backing those moves.

I've chosen WEN because its volume has been so high over the past few sessions:

But there's something making me scratch my head ... with this volume so high, shouldn't the stock price be higher by now? And what about that line connecting the last 3 highs?

Well, I have some doubts about this stock ... this kind of activity showed by volume must produce higher prices in the short term, or something's wrong. We'll give it a week.

Trading Plan:
1) Buy WEN at the open
2) If after this week WEN still trades below the blue trendline of the second chart, dump it.
3) If volume finally produces serious price increases (as I believe will happen), keep monitoring market action to know when to sell with a profit

David Randolph
www.3stocksonfire.org

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Food for Tought: Wendy's (WEN)

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