K plunges, losing $1.60 (-2.27%) within a single day on high volume
Kellogg Company (K) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, K ended the month 4.44% higher at 68.99 after tanking $1.60 (-2.27%) today on high volume, notably underperforming the S&P 500 (0.77%). This is the biggest single-day loss in over a month. Closing below Thursday's low at 69.83, the stock confirmed its breakout through the previous session low after trading up to $1.76 below it intraday.
Daily Candlestick Chart (K as at Jul 31, 2020):
Friday's trading range has been $2.51 (3.58%), that's far above the last trading month's daily average range of $1.37. Weekly volatility is also higher, being above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for K.
After trading as low as 68.07 during the day, Kellogg found support at the 20-day moving average at 68.19. Prices broke below the key technical support level at 69.05 (now R1), which is likely to act as resistance going forward. The last time this happened on July 13th, K actually gained 2.17% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Closed below last periods low" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Kellogg. Out of 395 times, K closed higher 52.41% 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 58.48% with an average market move of 0.55%.