CMG closes above its opening price after recovering from early selling pressure
Chipotle Mexican Grill Inc. (CMG) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, CMG ended the month 4.83% higher at 1052.36 after gaining $6.41 (0.61%) today, underperforming the S&P 500 (1.54%). Trading up to $13.99 lower after the open, the stock managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (CMG as at Jun 30, 2020):
Tuesday's trading range has been $21.22 (2.02%), that's below the last trading month's daily average range of $30.71. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for CMG. Prices continued to consolidate within a tight trading range between 1018.38 and 1057.51 where it has been caught now for the whole last trading week.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, two candlestick patterns are matching today's price action, the Bullish Spinning Top which is known as bullish pattern and one bearish pattern, the Hanging Man. The last time a Hanging Man showed up on June 25th, CMG lost -1.50% on the following trading day.
After having been unable to move above 1057.51 in the prior session, Chipotle Mexican ran into sellers again around the same price level today, missing to move higher than 1056.23.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could speed up should prices move above the close-by swing high at 1057.51 where further buy stops might get triggered. Selling could accelerate should prices move below the nearby swing low at 1021.00 where further sell stops might get activated. With prices trading close to this year's high at 1087.00, upside momentum could speed up should the share be able to break out to new highs for the year.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous High" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Chipotle Mexican. Out of 561 times, CMG closed higher 55.61% 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 57.22% with an average market move of 1.10%.