CNC finds buyers at key support level
Centene Corporation (CNC) Technical Analysis Report for Nov 09, 2018 | by Techniquant Editorial Team
CNC finished the week 10.05% higher at 142.31 after losing $1.34 (-0.93%) today, slightly underperforming the S&P 500 (-0.92%). Trading $1.17 higher after the open, the share was unable to hold its gains as the bears took control ending the day below 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 (CNC as at Nov 09, 2018):
Friday's trading range has been $3.15 (2.2%), that's below the last trading month's daily average range of $4.72. 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 significantly higher than usual for CNC.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
After trading down to 141.21 earlier during the day, the stock bounced off the key technical support level at 141.38 (S1). The failure to close below the support might increase that levels significance as support going forward. Prices are trading close to the key technical resistance level at 144.53 (R1). The market ran into sellers again today around 144.36 for the third trading day in a row after having found sellers at 143.90 in the previous session and at 143.86 two days ago. The last time this happened on Tuesday, CNC actually gained 9.23% on the following trading day.
Centene shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
With prices trading close to this year's high at 148.24, upside momentum could accelerate should CNC be able to break out to new highs for the year. Further buying might move prices higher should the market test October's close-by high at 147.00.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for Centene. Out of 444 times, CNC closed higher 57.43% 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 61.49% with an average market move of 1.43%.