CGNX closes lower for the 2nd day in a row
Cognex Corporation (CGNX) Technical Analysis Report for Aug 07, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, CGNX ended the week 0.4% higher at 67.14 after losing $0.43 (-0.64%) today on low volume, underperforming the S&P 500 (0.06%). Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (CGNX as at Aug 07, 2020):
Friday's trading range has been $1.42 (2.11%), that's slightly below the last trading month's daily average range of $1.63. 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 CGNX.
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.
After trading down to 66.34 earlier during the day, the share bounced off the key technical support level at 66.62 (S1). The failure to close below the support could increase that levels importance as support going forward. When prices bounced off a significant support level the last time on Tuesday, CGNX gained 2.04% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might speed up should prices move above the nearby swing high at 68.93 where further buy stops could get triggered. Trading close to 2018's high at 70.00 we might see further upside momentum if potential buy stops at the level get activated.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Cognex. Out of 297 times, CGNX closed higher 52.19% 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 62.63% with an average market move of 1.63%.