CNC unable to break through key resistance level
Centene Corporation (CNC) Technical Analysis Report for May 29, 2020 | by Techniquant Editorial Team
CNC ended the month -0.5% lower at 66.25 after losing $0.65 (-0.97%) today, notably underperforming the S&P 500 (0.48%). Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (CNC as at May 29, 2020):
Friday's trading range has been $2.74 (4.08%), that's slightly above the last trading month's daily average range of $2.45. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for CNC.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar. The last time this happened on March 20th, CNC lost -6.76% on the following trading day. Notwithstanding a strong opening Centene closed below the prior day's open and close, forming a bearish Engulfing Candle.
Unable to break through the key technical resistance level at 67.45 (R1), the stock closed below it after spiking up to 67.84 earlier during the day. The failure to close above the resistance could increase that levels importance going forward. After having been unable to move above 67.74 in the previous session, the share ran into sellers again around the same price level today, missing to move higher than 67.84.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
As prices are trading close to May's high at 70.62, upside momentum might accelerate should the market mark new highs for the month.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to prior High" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Centene. Out of 574 times, CNC closed higher 50.35% 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 64.29% with an average market move of 1.61%.