Can this AIM-listed champion retest record highs?

Fevertree Drinks (LSE:FEVR)

With a corporate name like this, we wonder why this mob don't sponsor "I'm a Nonentity" which is currently polluting UK TV screens! It certainly would tend to add something to the vacant lot of people confusing fleeting TV appearance with fame.

It can be correctly assumed we hope there's a special place in hell for reality TV shows, along with the industry which tends aggrandise them. However, it did give an excuse to look at this oddly named company.

Fevertree shares have certainly experienced a stonking rise since 2015, one we'd be hard pushed to accurately map due to the plethora of price manipulation gaps.

We're taking the attitude nowadays of not expecting gaps to be filled, especially in this case where all they tend signify is the market felt Fevertree share price should go higher.

Of course, we've now got a "however".

While mapping the upward path was well neigh impossible, the opposite appears true as recent reversals illustrate. The immediate situation is slightly dangerous, indicating below 1,850p (Dashed Red) should bring 1,765p. In reality, even price closure below 1,910 would alarm us, creating a new "lower low", opening the door for a downward drip. Worse, should 1,765p break, further leakage down to the 1,600p level makes a lot of sense.

Visually, common sense suggests a bounce at the 1,600p level if attained as it seems this point had some sort of importance to the market. Real danger would come below such a level as a future bonk against the uptrend looks like best guess.

Of course, there's another side to this misery as the movement on November 7th suggested the market may not be ready to let Fevertree weaken anytime soon.

Unfortunately, it also creates the situation where the price requires better than 2,225p currently to convince any upward surge may be genuine. Rather oddly, moves above 2,225p indicate the potential of growth to 2,325p. Secondary, if bettered, calculates at 2,716p, a new all time high.

We rather suspect the 1,600p level shall makes its presence felt first though.

ps. Do you get "Fevertrees" in a jungle?

Alistair Strang has led high-profile and "top secret" software projects since the late 1970s and won the original John Logie Baird Award for inventors and innovators. After the financial crash, he wanted to know "how it worked" with a view to mimicking existing trading formulas and predicting what was coming next. His results speak for themselves as he continually refines the methodology.

Alistair Strang is a freelance contributor and not a direct employee of Interactive Investor. All correspondence is with Alistair Strang, who for these purposes is deemed a third-party supplier. Buying, selling and investing in shares is not without risk. Market and company movement will affect your performance and you may get back less than you invest. Neither Alistair Strang, Shareprice, or Interactive Investor will be responsible for any losses that may be incurred as a result of following a trading idea. 

This article is for information and discussion purposes only and does not form a recommendation to invest or otherwise. The value of an investment may fall. The investments referred to in this article may not be suitable for all investors, and if in doubt, an investor should seek advice from a qualified investment adviser.