CAH runs into sellers around 45.55 for the third day in a row
Cardinal Health Inc. (CAH) Technical Analysis Report for Mar 27, 2020 | by Techniquant Editorial Team
CAH finished the week 2.42% higher at 44.38 after losing $1.02 (-2.25%) today on low volume, but still strongly outperforming the S&P 500 (-3.37%). Trading up to $0.79 lower after the open, the stock managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on March 18th, CAH actually lost -4.18% on the following trading day. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (CAH as at Mar 27, 2020):
Friday's trading range has been $2.34 (5.32%), that's below the last trading month's daily average range of $3.60. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for CAH. Prices continued to consolidate within a tight trading range between 41.81 and 46.19 where it has been caught now for the last three trading days.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, one bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
Prices are trading close to the key technical support level at 42.16 (S1). Prices are trading close to the key technical resistance level at 46.19 (R1). Cardinal Health ran into sellers again today around 45.55 for the third trading day in a row after having found sellers at 45.67 in the prior session and at 46.19 two days ago.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying could accelerate should prices move above the nearby swing high at 46.19 where further buy stops might get triggered. Selling could speed up should prices move below the close-by swing low at 41.81 where further sell stops might get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for Cardinal Health. Out of 658 times, CAH closed higher 54.56% 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 56.38% with an average market move of 0.23%.