CRC breaks below key technical support level
California Resources Corporation (CRC) Technical Analysis Report for Jul 17, 2019 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, CRC finished Wednesday at 15.52 tanking $2.84 (-15.47%) on high volume, significantly underperforming the S&P 500 (-0.65%). This is the biggest single-day loss in over a month. Today's close at 15.52 marks the lowest recorded closing price since June 6th. The bears were in full control today, moving the market lower throughout the whole session. Closing below Tuesday's low at 18.22, California Resources confirmed its breakout through the previous session low after trading up to $2.87 below it intraday.
Daily Candlestick Chart (CRC as at Jul 17, 2019):
Wednesday's trading range has been $2.98 (16.26%), that's far above the last trading month's daily average range of $1.11. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for CRC.
One bearish candlestick pattern matches today's price action, the Black Candle.
Prices broke below the key technical support level at 16.06 (now R1), which is likely to act as resistance going forward. The last time this happened on July 2nd, CRC lost -4.39% on the following trading day.
Crossing below the lower Bollinger Band for the first time since May 28th, prices have shown unusually strong downward momentum in the short-term. This could either indicate a potential selling climax after which prices might head back up towards the mean of the Bollinger Bands at 18.86 or signal the beginning of a strong momentum breakout leading to even lower prices.
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 14.88, downside momentum could speed up should the market break out to new lows for the year.
Among the 11 market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close crossed below the lower Bollinger Band" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for California Resources. Out of 36 times, CRC closed higher 58.33% 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 50.00% with an average market move of 3.00%.