COTY finds buyers again around 3.17
Coty Inc. Class A (COTY) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
COTY ended Wednesday at 3.25 gaining $0.07 (2.2%), strongly outperforming the S&P 500 (-0.46%). Trading up to $0.05 lower after the open, Coty managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (COTY as at Sep 16, 2020):
Wednesday's trading range has been $0.13 (4.04%), that's below the last trading month's daily average range of $0.18. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for COTY.
After moving lower in the previous session, the share managed to close higher but below the prior day's open, forming a bullish Harami Candle. Additionally, one bullish candlestick pattern matches today's price action, the Bullish Spinning Top. The last time a Bullish Spinning Top showed up on July 14th, COTY gained 4.76% on the following trading day.
After having been unable to move lower than 3.18 in the previous session, the stock found buyers again around the same price level today at 3.17.
Crossing above the lower Bollinger Band, prices have lost at least some of their downward momentum in the short-term and might now be heading back up towards the mean of the Bollinger Bands at 3.66.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
With prices trading close to this year's low at 3.02, downside momentum could speed up should the market break out to new lows for the year.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close crossed above the lower Bollinger Band" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for Coty. Out of 60 times, COTY closed lower 56.67% 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 65.00% with an average market move of -3.80%.