CF closes within prior day's range
CF Industries Holdings Inc. (CF) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, CF ended Thursday at 28.25 gaining $1.23 (4.55%) on low volume, notably underperforming the S&P 500 (6.24%). Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (CF as at Mar 26, 2020):
Thursday's trading range has been $2.11 (7.72%), that's slightly below the last trading month's daily average range of $2.52. 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 significantly higher than usual for CF.
Buyers managed to take out the key technical resistance level at 27.70 (now S1), which is likely to act as support going forward. The last time this happened on Tuesday, CF gained 5.46% on the following trading day. After having been unable to move above 28.89 in the prior session, the stock ran into sellers again around the same price level today, failing to move higher than 28.96.
While the market is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "3 Consecutive Higher Closes" stand out. Its common bullish interpretation has been confirmed for CF. Out of 162 times, CF closed higher 50.00% 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 54.32% with an average market move of 0.33%.