Wednesday, June 27, 2012

Brinker International Inc. (NYSE: EAT)

Brinker International, Inc. owns, develops, operates, and franchises various restaurant brands primarily in the United States. It operates the restaurants under the Chili's Grill & Bar and Maggiano's Little Italy brand names. As of August 29, 2011, the company owned, operated, and franchised 1,534 Chili's Grill & Bar restaurants and 45 Maggiano's Little Italy restaurants in 50 states, and Washington, D.C.; and held a minority investment in Romano's Macaroni Grill. It also has restaurants in the United States territories of Guam and Puerto Rico; and in the countries of Bahrain, Canada, the Dominican Republic, Ecuador, Egypt, El Salvador, Germany, Guatemala, Honduras, India, Indonesia, Japan, Jordan, Kuwait, Lebanon, Malaysia, Mexico, Oman, Peru, the Philippines, Portugal, Qatar, Russia, Saudi Arabia, Singapore, South Korea, Syria, Taiwan, the United Arab Emirates, and Venezuela. The company was founded in 1975 and is based in Dallas, Texas.

To review Brinker's stock, please take a look at the 1-year chart of EAT (Brinker International, Inc.) below with my added notations:

After trending higher for most of the last year, EAT has been consolidating within a small Rectangle over the last 2 months. A Rectangle pattern forms when a stock gets stuck bouncing between a horizontal support and resistance. A minimum of (2) successful tests of the support and (2) successful tests of the resistance will give you the pattern. For EAT, the Rectangle pattern has formed a $33 resistance (blue) and a $30 support area (navy).

The Tale of the Tape: EAT has formed a standard Rectangle pattern. The possible long positions on EAT would be either on a pullback to $30, or on a breakout above $33. The ideal short opportunity would be on a break below $30.

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