Stocks Decline as Nvidia and AI Stocks Slide

Shares in Chipotle Mexican Grill (CMG) were flat on Friday afternoon following a significant decline the day before, marking their largest daily percentage loss since last July. The stall in Chipotle’s stock comes ahead of a 50-for-1 stock split set to take effect next Wednesday.

Despite the recent decline, Chipotle’s stock has seen impressive gains of over 40% since the beginning of the year and has more than doubled since the start of 2023. Institutional investors may be taking the opportunity to book profits before the upcoming stock split.

Since finding support around the 200-day moving average last October, CMG shares have continued to trend higher, with buyers stepping in to buy pullbacks to the 50-day moving average. However, recent market activity, including a close below the breakout point on high trading volume, has raised concerns about a potential bull trap.

Additionally, a bearish divergence in the relative strength index (RSI) this week suggests weakening momentum for Chipotle’s stock. Investors are now looking to see where the stock may find buying support heading into next week’s split.

Overall, the market is closely watching Chipotle’s stock as it navigates the upcoming split and potential market fluctuations. Stay tuned for more updates on this developing story.