CMI closes higher for the 6th day in a row
Cummins Inc. (CMI) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
Moving higher for the 6th day in a row, CMI finished the week 2.47% higher at 139.54 after gaining $0.21 (0.15%) today, slightly outperforming the S&P 500 (-0.01%). Today's close at 139.54 marks the highest recorded closing price since December 6, 2018. Trading up to $0.81 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on December 27, 2018, CMI actually lost -0.69% on the following trading day. Closing above Thursday's high at 139.49, the stock confirmed its breakout through the previous session high after trading up to $0.61 above it intraday.
Daily Candlestick Chart (CMI as at Jan 11, 2019):
Friday's trading range has been $1.89 (1.36%), that's far below the last trading month's daily average range of $3.89. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly lower than usual for CMI. Prices continued to consolidate within a tight trading range between 135.29 and 140.10 where it has been caught now for the whole last trading week.
One bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
Prices are trading close to the key technical resistance level at 141.94 (R1).
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Selling might speed up should prices move below the nearby swing low at 135.78 where further sell stops could get triggered.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Closed above last periods high" stand out. Its common bullish interpretation has been confirmed for Cummins. Out of 387 times, CMI closed higher 52.97% 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 57.88% with an average market move of 1.08%.