Wednesday, December 17, 2025

This Beaten-Down Name Is Showing Signs of Life

Trade of the Day Wake-Up Watchlist

"Multiple timeframe compression doesn't guarantee direction. But it guarantees volatility is coming."

Nate Bear, Lead Technical Tactician, Monument Traders Alliance

Nate Bear

I've been scanning some of the year's biggest losers. Most are trash. But CAVA caught my attention for the wrong reasons... then kept it for the right ones.

Down 52% year-to-date. Mediterranean fast-casual chain. Everyone's written it off.

But the chart's saying something different.

The Setup

CAVA is sitting at $53. The daily chart shows a cup and handle. The handle's forming right now in the $52-$54 range.

Here's what's interesting... squeezes are building on both 195-minute and 135-minute timeframes. When you get compression stacking up like this, it's storing energy like a coiled spring getting tighter.

Think of it this way... when a stock gets trapped in smaller and smaller price ranges, every sideways day adds more pressure. The longer the compression lasts, the bigger the eventual move when it breaks.

Multiple timeframe squeezes don't guarantee direction. But they guarantee volatility is coming.

When both the 195-minute and 135-minute squeezes are happening simultaneously, the resolution move tends to be fast.

 

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The Risk/Reward

With CAVA at $53, you're not chasing anything. You're positioning before the energy releases. The handle needs to break above $55 for the pattern to work.

A small premium gets you exposure to asymmetric upside. If this thing resolves higher, the gap closes, and potentially runs all the way up toward $80. That's the technical target, not necessarily this week's target.

Risk is whatever you pay. The reward could be substantial if this oversold condition reverses with momentum.

Your Action Plan

This isn't just about CAVA. It's about recognizing when heavily beaten-down names start showing signs of life. The market loves to overshoot. Stocks that fell too far, too fast often snap back just as violently when the technical setup aligns.

Multiple squeezes + oversold conditions + defined pattern = worth watching.

The compression will resolve. Direction determines everything. But the setup's there.

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Let's make these next 3 days count.

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