IFF finds support at 100-day moving average
Internationa Flavors & Fragrances Inc. (IFF) Technical Analysis Report for Oct 12, 2018 | by Techniquant Editorial Team
Moving lower for the 4th day in a row, IFF ended the week -5.52% lower at 130.92 after losing $1.71 (-1.29%) today, significantly underperforming the S&P 500 (1.42%). Today's close at 130.92 marks the lowest recorded closing price since September 11th. The bears were in full control today, moving the market lower throughout the whole session. Closing below Thursday's low at 131.52, the market confirmed its breakout through the prior session low after trading up to $1.87 below it intraday.
Daily Candlestick Chart (IFF as at Oct 12, 2018):
Friday's trading range has been $5.48 (4.06%), that's far above the last trading month's daily average range of $2.71. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for IFF.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bearish Outside Bar. Additionally, two candlestick patterns are matching today's price action, the Last Engulfing Bottom Pattern which is known as bullish pattern and one bearish pattern, the Black Candle.
After trading as low as 129.65 during the day, the share found support at the 100-day moving average at 130.16. Prices are trading close to the key technical resistance level at 132.98 (R1). After having been unable to move above 134.79 in the previous session, Intl Flavors ran into sellers again around the same price level today, missing to move higher than 135.13. The last time this happened on Tuesday, IFF lost -2.54% on the following trading day.
With another close below the lower Bollinger Band, prices are confirming their strong downward momentum in the short-term. A rally back into the Bollinger Band on the next trading day though might signal a potential change in momentum that could lead to a correction back up towards the center of the Bollinger Bands at 137.39.
While still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "4 Consecutive Lower Closes" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Intl Flavors. Out of 61 times, IFF closed higher 60.66% 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 67.21% with an average market move of 1.01%.