CPG.L runs into sellers again around 1578.50
Compass Group PLC (CPG.L) Technical Analysis Report for Oct 12, 2018
CPG.L finished the week -3.04% lower at 1546.50 after losing £8.50 (-0.55%) today, slightly underperforming the FTSE 100 (-0.16%). The bears were in full control today, moving the market lower throughout the whole session. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (CPG.L as at Oct 12, 2018):
Friday's trading range has been £38.50 (2.44%), that's above the last trading month's daily average range of £29.07. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently strongly higher than usual for CPG.L.
One bearish candlestick pattern matches today's price action, the Black Candle.
After having been unable to move above 1575.00 in the previous session, the market ran into sellers again around the same price level today, failing to move higher than 1578.50. The last time this happened on Tuesday, CPG.L lost -3.74% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Selling might accelerate should prices move below the nearby swing low at 1525.50 where further sell stops could get activated.
Among the six 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. While it is usually interpreted as bearish, it has actually shown to be bullish for Compass Grp.. Out of 508 times, CPG.L closed higher 53.54% 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 62.01% with an average market move of 1.28%.