CGC closes lower for the 2nd day in a row


Canopy Growth Corporation (CGC) Technical Analysis Report for Feb 13, 2020 | by Techniquant Editorial Team

Highlights

CGC runs into sellers around 20.44 for the third day in a row
CGC closes lower for the 2nd day in a row
CGC still stuck within tight trading range
CGC closes within previous day's range

Overview

Moving lower for the 2nd day in a row, CGC finished Thursday at 19.52 losing $0.13 (-0.66%), slightly underperforming the S&P 500 (-0.16%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.

Daily Candlestick Chart (CGC as at Feb 13, 2020):

Daily technical analysis candlestick chart for Canopy Growth Corporation (CGC) as at Feb 13, 2020

Thursday's trading range has been $1.18 (6.1%), that's slightly below the last trading month's daily average range of $1.32. 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 CGC. Prices continued to consolidate within a tight trading range between 18.65 and 20.61 where it has been caught now for the whole last trading week.

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. The last time this happened on Tuesday, CGC actually lost -1.31% on the following trading day.

Prices are trading close to the key technical support level at 19.21 (S1). The stock ran into sellers again today around 20.44 for the third trading day in a row after having found sellers at 20.30 in the previous session and at 20.51 two days ago.

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 20.51 where further buy stops might get triggered. Selling could speed up should prices move below the close-by swing low at 18.65 where further sell stops might get activated. Trading close to December's low at 17.61 we could see further downside momentum if potential sell stops at the level get triggered.

Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. Though it is usually interpreted as neutral, it has actually shown to be bearish for Canopy Growth. Out of 439 times, CGC closed lower 51.94% 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 five trading days, showing a win rate of 55.35% with an average market move of 0.02%.


Market Conditions for CGC as at Feb 13, 2020

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