GNC.AX ends the day on a bearish note closing near the low of the day
Graincorp Limited Class A (GNC.AX) Technical Analysis Report for Oct 12, 2018 | by Techniquant Editorial Team
Moving lower for the 5th day in a row, GNC.AX finished the week -6.96% lower at 7.75 after losing $0.12 (-1.52%) today, notably underperforming the market (ASX 200, 0.2%). Today's close at 7.75 marks the lowest recorded closing price since August 21st. The bears were in full control today, moving the market lower throughout the whole session. Ending with a weak close near the low of the day sets a bearish note for the next session.
Daily Candlestick Chart (GNC.AX as at Oct 12, 2018):
Friday's trading range was $0.10 (1.28%), that's far below last trading month's daily average range of $0.15. Things look different on a weekly scale, where volatility is way above the markets average with the monthly volatility being slightly above average.
Two candlestick patterns are matching today's price action, the Bearish Short Candle and the Black Candle which are both known as bearish patterns.
After trading as low as 7.73 during the day, the market bounced off the key support level at 7.74. The failure to close below the support might increase that levels importance as support going forward. The last time this happened on September 12th, GNC.AX gained 1.65% on the following trading day.
Though Graincorp Limited is currently in a short-term down trend, this could just be a correction, as the medium and long term trends are both positive. The stock broke below the 100-day moving average at 7.80 today for the first time since August 31st.
Further selling might move prices lower should the market test September's nearby low at 7.72.
Among the 11 market conditions that our engine recognized today, the statistics for the Price Action based condition "5 Consecutive Lower Closes" stands out. It's common interpretation of being bearish has so far been confirmed for Graincorp Limited in the past. Out of 29 times during the last ten years, GNC.AX closed lower 55.17% of the time on the next trading day. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 51.72% with an average market move of -2.46%.