Chipotle Mexican Grill could start a technical downward trend after the rebound in recent sessions.

Poor financials attest of the weakened situation that covers the american restaurant chain. The last earnings release was a big deception as the company posted out only $83 million on earnings while consensus expected $90 million, . An excessive valuation is observed through the P/E ratio that ask investors for paying 47.2 times estimated earnings of the food maker.

Graphically, the stock went through a period of rebound in recent sessions towards the USD 611.60 medium-term resistance. The share should now consolidate near this area as this level act as a stopping point of the upward movement. This scenario suggests a return to the USD 550.60 support area which will be confirmed once the USD 579 level broke down.

The upside seems limited as shown by fundamentals and technical configuration. In sum, short positions are preferred near USD 611.6 looking for significant falls that could bring prices toward USD 579 in first place and then toward USD 550.6, nevertheless, a stop loss above this resistance may be set.