CDEV ends the day indecisive
Centennial Resource Development Inc. (CDEV) Technical Analysis Report for Sep 18, 2020 | by Techniquant Editorial Team
Moving higher for the 6th day in a row, CDEV finished the week 39.62% higher at 0.74 after gaining $0.05 (7.25%) today on high volume, strongly outperforming the S&P 500 (-1.12%). Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (CDEV as at Sep 18, 2020):
Friday's trading range has been $0.11 (15.49%), that's far above the last trading month's daily average range of $0.06. Weekly volatility is also higher, being above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for CDEV.
Buyers managed to take out the key technical resistance level at 0.72 (now S1), which is likely to act as support going forward. The last time this happened on Monday, CDEV gained 5.26% on the following trading day. After spiking up to 0.81 during the day, Centennial Resource found resistance at the 50-day moving average at 0.78.
Although the share is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Buying might speed up should prices move above the nearby swing high at 0.81 where further buy stops could get activated.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Bounce off SMA 50" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Centennial Resource. Out of 15 times, CDEV closed higher 53.33% 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 1.26%.