CMG falls to lowest close since August 24th
Chipotle Mexican Grill Inc. (CMG) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
CMG finished Wednesday at 1265.87 losing $11.49 (-0.9%) on low volume, slightly underperforming the S&P 500 (-0.46%). Today's close at 1265.87 marks the lowest recorded closing price since August 24th. The bears were in full control today, moving the market lower throughout the whole session. Closing below Tuesday's low at 1269.10, Chipotle Mexican confirmed its breakout through the previous session low after trading up to $4.97 below it intraday.
Daily Candlestick Chart (CMG as at Sep 16, 2020):
Wednesday's trading range has been $22.71 (1.77%), that's below the last trading month's daily average range of $37.93. Things look different on the weekly timeframe, where the market's trading range of the last week has been above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for CMG.
Four candlestick patterns are matching today's price action, the Bullish Hikkake Pattern and the Last Engulfing Bottom Pattern which are both known as bullish patterns and two bearish patterns, the Bearish Short Candle and the Black Candle. The last time a Last Engulfing Bottom Pattern showed up on June 12th, CMG gained 3.17% on the following trading day.
Prices are trading close to the key technical support level at 1258.53 (S1). After having been unable to move lower than 1269.10 in the prior session, the stock found buyers again around the same price level today at 1264.13.
Although the market is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Selling could accelerate should prices move below the close-by swing low at 1254.53 where further sell stops might get activated.
Among the 11 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Hikkake Pattern" stand out. Its common bullish interpretation has been confirmed for Chipotle Mexican. Out of 102 times, CMG closed higher 53.92% 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 62.75% with an average market move of 1.56%.