FTR finds buyers around 0.36 for the third day in a row
Frontier Communications Corporation (FTR) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
FTR ended Thursday at 0.39 gaining $0.03 (8.33%), notably outperforming the S&P 500 (6.24%). Trading up to $0.02 lower after the open, Frontier Communications managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (FTR as at Mar 26, 2020):
Thursday's trading range has been $0.05 (13.16%), that's slightly below the last trading month's daily average range of $0.10. Things look different on the weekly timeframe, where the market's trading range of the last week has been way above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for FTR. Prices continued to consolidate within a tight trading range between 0.34 and 0.42 where it has been caught now for the last three trading days.
Two candlestick patterns are matching today's price action, the Bullish Spinning Top which is known as bullish pattern and one bearish pattern, the Bearish Hikkake Pattern. The last time a Bearish Hikkake Pattern showed up on March 20th, FTR lost -56.67% on the following trading day.
Prices are trading close to the key technical support level at 0.29 (S1). Unable to break through the key technical resistance level at 0.41 (R1), the share closed below it after spiking up to 0.41 earlier during the day. The failure to close above the resistance might increase that levels importance going forward. The market found buyers again today around 0.36 for the third trading day in a row after having found demand at 0.35 in the prior session and at 0.34 two days ago.
Though the stock is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Selling might accelerate should prices move below the nearby swing low at 0.34 where further sell stops could get triggered.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Hikkake Pattern" stand out. Its common bearish interpretation has been confirmed for Frontier Communications. Out of 98 times, FTR closed lower 50.00% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 57.14% with an average market move of -2.90%.