Shares of this restaurant chain are forming a long-term turnaround, according to the charts

Published Mon, Feb 5 202412:29 PM EST

Dave & Buster's Entertainment (PLAY) is a restaurant and sports entertainment company with a compelling long-term setup on its chart. It has been rallying alongside the sports betting stocks, like DraftKings and Flutter , which are in the news ahead of the Super Bowl, and also look compelling on their charts. We think PLAY can uphold positive long-term momentum from a technical perspective. In late December, the stock cleared major resistance going back to early 2020, resolving a multi-year trading range higher in a bullish development. PLAY had previously trended lower, after peaking in 2017, so the recent breakout gives the chart the shape of a long-term turnaround. To generate an upside target for PLAY, we can project the width of the trading range higher. Hence the common technical saying: "The bigger the base, the higher in space." This method projects a long-term target of $75, which roughly aligns with final resistance from the 2017 peak. Interim resistance is from the 2019 high, near $60. Support is strong near $49-$50. After a pullback to begin 2024, PLAY has rebounded, shifting our short-term trend-following gauges higher. This shift is reflected in the stochastic oscillator on the weekly bar chart, which has a "pop" higher in a bullish catalyst. The weekly MACD indicator is positive, and diverging, also in support of the intermediate-term uptrend. —Katie Stockton with Will Tamplin Access research from Fairlead Strategies for free here . DISCLOSURES: (None) THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY . THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO BUY ANY SECURITY OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT ANY INDIVIDUAL'S UNIQUE PERSONAL CIRCUMSTANCES. THE ABOVE CONTENT MIGHT NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. 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