DARDEN RESTAURANTS INC (NYSE:DRI) is setting up nicely for a breakout.

Our stock screener has detected a potential breakout setup on DARDEN RESTAURANTS INC (NYSE:DRI). This breakout pattern is observed when a stock consolidates following a strong upward movement. It's important to note that this pattern is based on technical analysis, and the actual breakout outcome is uncertain. However, it might be worth keeping an eye on NYSE:DRI.

Technical Analysis Observations

ChartMill assigns a proprietary Technical Rating to each stock. The score is computed daily by evaluating various technical indicators and properties. The score ranges from 0 to 10.

Overall DRI gets a technical rating of 7 out of 10. This is due to a consistent overall performance, although we see some doubts in the very recent evolution. In the medium time frame things are still looking good.

• The long term trend is positive and the short term trend is neutral. The long term trend gets the benefit of the doubt for now.
• When comparing the yearly performance of all stocks, we notice that DRI is one of the better performing stocks in the market, outperforming 89% of all stocks.
• DRI is part of the Hotels, Restaurants & Leisure industry. There are 136 other stocks in this industry. DRI outperforms 82% of them.
• DRI is currently trading in the upper part of its 52 week range. The market is still in the middle of its 52 week range, so DRI slightly outperforms the market at the moment.
• In the last month DRI has a been trading in the 181.00 - 210.74 range, which is quite wide. It is currently trading in the middle of this range where prices have been consolidating recently, this may present a good entry opportunity, but some resistance may be present above.

Our latest full technical report of DRI contains the most current technical analsysis.

How do we evaluate the setup for DRI?

ChartMill takes into account not only the Technical Rating but also assigns a Setup Rating to each stock. This rating, on a scale of 0 to 10, reflects the degree of consolidation observed based on short-term technical indicators. Currently, DRI exhibits a 8 setup rating, indicating its consolidation status in recent days and weeks.

Besides having an excellent technical rating, DRI also presents a decent setup pattern. Prices have been consolidating lately and the volatility has been reduced. A pullback is taking place, which may present a nice opportunity for an entry. There is very little resistance above the current price. There is a support zone below the current price at 199.07, a Stop Loss order could be placed below this zone.

How can DRI be traded?

A breakout could materialize when the stock breaks out to new highs above the current consolidation zone. One could wait for this to happen and buy when this happens. A stop loss could be placed below the consolidation zone.

Of course, there are many ways to trade or not trade DRI and this article should in no way be interpreted as trading advice. The article is purely based on an automated technical analysis and just points out the technical observations. Always make your own analysis and trade at your own responsibility.

More breakout setups can be found in our Breakout screener.

Keep in mind

Important Note: The content of this article is not intended as trading advice. It is essential to perform your own analysis and exercise caution when making trading decisions. The article presents observations created by automated analysis but does not guarantee any trading or investment outcomes. Always trade responsibly and make independent judgments.