CAG closes above its opening price after recovering from early selling pressure
ConAgra Brands Inc. (CAG) Technical Analysis Report for Oct 12, 2018 | by Techniquant Editorial Team
CAG finished the week 5.21% higher at 35.34 after gaining $0.47 (1.35%) today, slightly underperforming the S&P 500 (1.42%). Trading up to $0.24 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (CAG as at Oct 12, 2018):
Friday's trading range has been $0.60 (1.71%), that's slightly below the last trading month's daily average range of $0.75. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for CAG.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar.
The share managed to break above the 20-day moving average at 35.33 today for the first time since September 11th. Unable to break through the key technical resistance level at 35.41 (R1), the stock closed below it after spiking up to 35.42 earlier during the day. The failure to close above the resistance could increase that levels significance going forward. When prices bounced off a significant resistance level the last time on September 26th, CAG lost -8.54% on the following trading day. After having been unable to move lower than 34.77 in the previous session, ConAgra Foods found buyers again around the same price level today at 34.82.
While CAG is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Selling could accelerate should prices move below the close-by swing low at 34.77 where further sell stops might get triggered.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. Though it is usually interpreted as neutral, it has actually shown to be bullish for ConAgra Foods. Out of 745 times, CAG closed higher 51.68% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 60.00% with an average market move of 0.60%.