Cheesecake Factory (CAKE) Gets $200M Investment From Roark Capital, Stock Moving Higher

Steve Miller
cheesecake factory stock chart price reversal bullish analysis roark capital investment april 20

Cheesecake Factory (CAKE) Weekly Chart

On Monday morning, Cheesecake Factory NASDAQ: CAKE announced that Roark Capital invested $200M in the company in the form of a convertible preferred investment.

CEO David Overton noted that the investment was critical to enhance the company’s liquidity position.

The stock rallied almost 6% on the day.

Given this background, let’s see what the charts tell us.

At askSlim we use technical analysis to evaluate price charts of stocks, futures, and ETF’s. We use a combination of cycle, trend and momentum chart studies, on multiple timeframes, to present a “sum of the evidence” directional outlook in time and price.

askSlim Technical Briefing: The weekly cycle analysis suggests that CAKE is in an intermediate-term rising phase in a very negative long-term pattern. The next projected intermediate-term low is due in early August. Weekly momentum is negative.

cheesecake factory stock bullish reversal indicators 200 million dollar investment april 20

On the upside, there is an intermediate-term Fibonacci resistance at 21.77 followed by another zone of resistance from 26.26 – 29.88.

On the downside, the only visible support is the recent 10-year low at 14.52. For the bulls to regain control of the intermediate-term, we would need to see a weekly close above 33.50 to repair some of the damage down on the downside.

askSlim Sum of the Evidence: CAKE is in an intermediate-term rising phase with negative momentum. Given these conditions, we would expect CAKE to rally up to the intermediate-term resistances beginning at 21.77 before seeing a reversal to the downside.

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Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.