CPB closes within prior day's range after lackluster session
Campbell Soup Company (CPB) Technical Analysis Report for Jan 17, 2020 | by Techniquant Editorial Team
CPB finished the week 0.61% higher at 48.02 after losing $0.07 (-0.15%) today, underperforming the S&P 500 (0.39%) ahead of tomorrow's Martin Luther King Jr. Day market holiday. Trading $0.25 higher after the open, the market 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 failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (CPB as at Jan 17, 2020):
Friday's trading range has been $0.35 (0.73%), that's below the last trading month's daily average range of $0.59. 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 CPB.
After moving higher in the previous session, Campbell Soup closed lower but above the prior day's open today, forming a bearish Harami Candle. Additionally, two candlestick patterns are matching today's price action, the Bearish Spinning Top and the Shooting Star which are both known as bearish patterns. The last time a Shooting Star showed up on December 17, 2019, CPB actually gained 0.96% on the following trading day.
Unable to break through the key technical resistance level at 48.07 (R1), the share closed below it after spiking up to 48.32 earlier during the day. The failure to close above the resistance could increase that levels significance going forward.
Though the stock is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Selling could accelerate should prices move below the nearby swing low at 47.45 where further sell stops might get activated.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Close near low of period" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Campbell Soup. Out of 475 times, CPB closed higher 56.00% 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 56.21% with an average market move of 0.31%.