Chipotle fell more than 2 percent on Wednesday following a downgrade from Bank of America, but the charts are suggesting that there might actually be a reprieve for the beaten-down stock.
"[Chipotle stock] is starting to form a base down at the $300 level," Matt Maley, equity strategist at Miller Tabak, said Wednesday on CNBC's "Power Lunch." "It tested that level back in August, again in September, again earlier this month in October, and it has held [that level] each time."
What's more, the stock is still trading above its 50-day moving average in spite of the negative sentiment on Wall Street, another positive sign, according to Maley.
"We're at a key juncture on a technical basis right now," explained the strategist. "If the stock continues to roll over and breaks meaningfully below $300, that's a big problem."
"However, if it can rally from here and break above its highs from last weekend at the $332 level, it's going to show that at least on a technical basis the worst might actually be behind it," he added.
That could be music to the ears of many Chipotle investors, who have watched the stock tank nearly 60 percent over the past two years thanks to a series of health scares.
But Gina Sanchez, CEO of Chantico Global, says the labor issue that led to the Bank of America downgrade is a legitimate concern for Chipotle. Bank of America essentially asserted on Wednesday that the chain will have trouble cutting back on labor costs.
"[Chipotle] is the most expensive stock right now relative to other similar companies like Jack in the Box, and they've obviously had some issues," she said. "This labor issue, however, is a real issue, and I would be looking at it."
The stock has plunged over 35 percent since hitting year-to-date highs mid-May.