CMS closes below its opening price unable to hold early session gains
CMS Energy Corporation (CMS) Technical Analysis Report for Jul 13, 2020 | by Techniquant Editorial Team
CMS finished Monday at 59.38 edging lower $0.09 (-0.15%), but still outperforming the S&P 500 (-0.94%). Trading $0.85 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on July 6th, CMS lost -0.90% on the following trading day. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (CMS as at Jul 13, 2020):
Monday's trading range has been $1.20 (2.02%), that's below the last trading month's daily average range of $1.43. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for CMS.
Two candlestick patterns are matching today's price action, the Bearish Spinning Top and the Shooting Star which are both known as bearish patterns.
Unable to break through the key technical resistance level at 60.34 (R1), the stock closed below it after spiking up to 60.34 earlier during the day. The failure to close above the resistance could increase that levels significance going forward.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Spinning Top" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for CMS Energy. Out of 208 times, CMS closed higher 53.85% 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 68.27% with an average market move of 0.99%.