CAG finds buyers at key support level
ConAgra Brands Inc. (CAG) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
CAG ended the month 6.48% higher at 37.45 after gaining $0.08 (0.21%) today on low volume, underperforming the S&P 500 (0.77%). Trading up to $0.42 lower after the open, the stock managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (CAG as at Jul 31, 2020):
Friday's trading range has been $0.85 (2.28%), that's above the last trading month's daily average range of $0.74. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for CAG.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bullish Outside Bar. Additionally, three candlestick patterns are matching today's price action, the Bullish High-Wave Candle and the Bullish Spinning Top which are both known as bullish patterns and one bearish pattern, the Last Engulfing Top Pattern. The last time a Bullish High-Wave Candle showed up on June 30th, CAG gained 1.42% on the following trading day.
After trading down to 36.91 earlier during the day, the market bounced off the key technical support level at 37.12 (S1). The failure to close below the support might increase that levels importance as support going forward.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could accelerate should prices move above the close-by swing high at 37.82 where further buy stops might get triggered.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for ConAgra Brands. Out of 443 times, CAG closed higher 57.11% 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 54.85% with an average market move of 0.28%.