CF runs into sellers around 27.78 for the forth day in a row


CF Industries Holdings Inc. (CF) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team

Highlights

CF runs into sellers around 27.78 for the forth day in a row
CF stuck within tight trading range
CF closes within previous day's range after lackluster session

Overview

CF finished the week 11.16% higher at 27.59 after edging lower $0.11 (-0.4%) today on low volume, underperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. 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 (CF as at May 22, 2020):

Daily technical analysis candlestick chart for CF Industries Holdings Inc. (CF) as at May 22, 2020

Friday's trading range has been $0.51 (1.84%), that's far below the last trading month's daily average range of $1.20. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for CF. Prices continued to consolidate within a tight trading range between 27.26 and 27.97 where it has been caught now for the last three trading days.

Two candlestick patterns are matching today's price action, the Bullish Hikkake Pattern which is known as bullish pattern and one bearish pattern, the Bearish Spinning Top. The last time a Bullish Hikkake Pattern showed up on March 17th, CF actually lost -12.46% on the following trading day.

Prices are trading close to the key technical resistance level at 27.85 (R1). The share was sold again around 27.78 after having seen highs at 27.86, 27.97 and 27.84 in the last three trading sessions. Obviously there is something going on at that level.

The market shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.

Buying could accelerate should prices move above the nearby swing high at 27.97 where further buy stops might get activated. As prices are trading close to May's high at 29.20, upside momentum could speed up should the stock mark new highs for the month.

Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous three Highs" stand out. Its common bearish interpretation has been confirmed for CF. Out of 23 times, CF closed lower 56.52% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 65.22% with an average market move of -1.28%.


Market Conditions for CF as at May 22, 2020

Loading Market Conditions for CF (CF Industries Holdings Inc.)...
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CF closes within previous day's range

May 29, 2020
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