CTSH closes within previous day's range after lackluster session
Cognizant Technology Solutions Corporation (CTSH) Technical Analysis Report for Jun 01, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, CTSH finished Monday at 52.85 edging lower $0.15 (-0.28%), underperforming the Nasdaq 100 (0.45%). Trading $0.33 higher after the open, Cognizant Technology was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on April 28th, CTSH actually gained 4.78% on the following trading day. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (CTSH as at Jun 01, 2020):
Monday's trading range has been $0.85 (1.6%), that's far below the last trading month's daily average range of $1.75. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for CTSH.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
Prices are trading close to the key technical resistance level at 53.91 (R1). After having been unable to move lower than 52.23 in the prior session, the market found buyers again around the same price level today at 52.48.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Selling might accelerate should prices move below the close-by swing low at 52.23 where further sell stops could get triggered.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Bearish Intraday Reversal" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Cognizant Technology. Out of 386 times, CTSH closed higher 55.18% 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 59.84% with an average market move of 0.66%.