Over the last few weeks, the shares of Luckin Coffee (OTCMKTS:LKNCY) have been hot. In fact, since Sept., Luckin stock has soared from a low of $2.27 to $5.05 as of Friday’s close. If it can break above its double-top resistance at $6.23, it could run higher.
There’s no compelling reason to get excited about this stock. The only real news out there is that Chinese regulatory authorities will impose a 61 million yuan penalty against the company after it admitted to fabricating revenue earlier this year.
Granted, the stock looks technically attractive at the moment. But I’d avoid it for the time being. I’m not willing to get burned again by the company.