IMAX closes within previous day's range
Imax Corporation (IMAX) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
IMAX ended Thursday at 10.25 gaining $0.11 (1.08%) on low volume, strongly underperforming the S&P 500 (6.24%). Trading $0.67 higher after the open, the share was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (IMAX as at Mar 26, 2020):
Thursday's trading range has been $1.07 (10.38%), that's slightly below the last trading month's daily average range of $1.57. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently significantly higher than usual for IMAX. Prices continued to consolidate within a tight trading range between 9.91 and 12.88 where it has been caught now for the whole last trading week.
Two candlestick patterns are matching today's price action, the Homing Pigeon which is known as bullish pattern and one bearish pattern, the Bearish Spinning Top. The last time a Bearish Spinning Top showed up on March 16th, IMAX lost -21.75% on the following trading day.
After trading down to 9.91 earlier during the day, the stock bounced off the key technical support level at 10.01 (S1). The failure to close below the support could increase that levels significance as support going forward. Imax was bought again around 9.91 after having seen lows at 10.01, 10.22 and 10.01 in the last three trading sessions. Obviously there is something going on at that level.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Homing Pigeon" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for Imax. Out of 19 times, IMAX closed lower 68.42% 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 68.42% with an average market move of -1.92%.