CPG.L breaks back above 20-day moving average
Compass Group PLC (CPG.L) Technical Analysis Report for Nov 09, 2018 | by Techniquant Editorial Team
CPG.L ended the week -0.02% lower at 1537.50 after gaining £22.50 (1.49%) today, significantly outperforming the FTSE 100 (-0.5%). The bulls were in full control today, moving the market higher throughout the whole session. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (CPG.L as at Nov 09, 2018):
Friday's trading range has been £31.00 (2.05%), that's slightly below the last trading month's daily average range of £32.40. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly lower than usual for CPG.L. Prices continued to consolidate within a tight trading range between 1499.00 and 1552.50 where it has been caught now for the whole last trading week.
Even with a weak opening the stock managed to close above the previous day's open and close, forming a bullish Engulfing Candle. Additionally, one bullish candlestick pattern matches today's price action, the White Candle. The last time a White Candle showed up on October 25th, CPG.L actually lost -0.91% on the following trading day.
The share managed to close back above the 20-day moving average at 1528.50. After having been unable to move above 1538.00 in the prior session, Compass Grp. ran into sellers again around the same price level today, failing to move higher than 1538.50.
Although the market is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Buying might speed up should prices move above the close-by swing high at 1552.50 where further buy stops could get triggered.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Close near high of period" stand out. Its common bullish interpretation has been confirmed for Compass Grp.. Out of 566 times, CPG.L closed higher 51.59% 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 57.07% with an average market move of 0.75%.