McDonald’s: A Bullish Breakout on the Horizon?

At Extreme Investor Network, we’re always on the lookout for the next big opportunity in the stock market. Recently, McDonald’s (MCD) has been in the spotlight, particularly after reporting its latest earnings. The fast-food giant is signaling that it could be on the verge of an exciting market move, and here’s why you should keep an eye on it.

Steady Climb Towards All-Time Highs

Following a positive earnings report, McDonald’s has steadily gained momentum, nearing its all-time highs around $325, which it hit back in mid-March. What’s particularly intriguing for investors is the formation of a potential bullish cup-and-handle pattern on the charts. Historically, this formation has served as a launchpad for upward momentum in the stock.

The Track Record of Chart Formations

In the past nine months, McDonald’s has demonstrated a knack for capitalizing on similar bullish patterns. For instance, a breakout from a comparable setup last July initiated a significant price rally that continued into early October. This wasn’t just a one-time occurrence; in February, McDonald’s broke out from two additional bullish patterns, paving the way for current potential gains.

If McDonald’s successfully breaks out of the current cup-and-handle formation, it could target prices as high as $350 per share. Given the technical indicators at play, the stage appears to be set for another upward push.

Above Key Moving Averages

Currently, McDonald’s is trading above all its key moving averages, including the crucial 50-day moving average—represented graphically in green on our chart. Historical trends indicate that when McDonald’s consistently breaks above the 50-day line, it typically leads to strong price increases in subsequent months.

Take 2020, 2021, and even visually forecasting trends for 2024; rallies post-50-day line breaks averaged over 20%. Since reclaiming this moving average in early 2025, the stock has gained approximately 9%. This precedes promising signs that we could see further upward momentum.

A Long-Term Upward Trend

Zooming out gives us an even bigger picture. McDonald’s has been navigating within a well-defined upward-sloping trading channel since bouncing back from COVID-induced lows in 2020. This consistent oscillation provides a reassuring stabilizing factor for investors. Currently, the stock sits near the midpoint of this channel, hinting at notable upside potential if it can rally back toward the upper edge once again.

What’s Next for McDonald’s?

With McDonald’s on the verge of potentially breaking out from its latest bullish formation, having recently reestablished its position over the 50-day moving average, and trading within a long-term upward channel, the technical indicators remain favorable.

However, as with any investment, risks persist. A failure to break out could leave investors disappointed, and aggressive selling pressure against any new highs could create a setback. Yet, for those looking to ride the wave of technical strength, McDonald’s presents a compelling narrative.

At Extreme Investor Network, we encourage you to consider the information carefully. Investment opportunities can be volatile, and while McDonald’s shows promise, every investor’s circumstances are unique. Always look to consult with a financial advisor before making any investment decisions.

Join our community for more insights as we continue to explore the evolving landscape of investment opportunities tailored to you!