CNA.L ends the day on a bullish note closing near the high of the day
Centrica plc (CNA.L) Technical Analysis Report for Dec 07, 2018 | by Techniquant Editorial Team
CNA.L finished the week 1.34% higher at 139.60 after gaining £3.60 (2.65%) today, strongly outperforming the FTSE 100 (1.1%). Trading up to £1.65 lower after the open, the share managed to reverse during the session as bulls took control ending the day above its opening price. Ending with a strong close near the high of the day sets a bullish note for the next session.
Daily Candlestick Chart (CNA.L as at Dec 07, 2018):
Friday's trading range has been £3.75 (2.72%), that's slightly below the last trading month's daily average range of £4.40. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for CNA.L.
Two candlestick patterns are matching today's price action, the White Candle which is known as bullish pattern and one bearish pattern, the Bearish Hikkake Pattern. The last time a Bearish Hikkake Pattern showed up on October 30th, CNA.L lost -1.66% on the following trading day.
After trading down to 136.05 earlier during the day, Centrica bounced off the key technical support level at 137.45 (S1). The failure to close below the support could increase that levels significance as support going forward. Prices are trading close to the key technical resistance level at 141.85 (R1).
Though the stock is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could accelerate should prices move above the nearby swing high at 141.00 where further buy stops might get triggered.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "RSI(2) above 80" stand out. Its common bearish interpretation has been confirmed for Centrica. Out of 270 times, CNA.L closed lower 54.44% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 51.85% with an average market move of -0.33%.