KEM finds buyers again around 27.04
KEMET Corporation (KEM) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
KEM finished the week 0.04% higher at 27.05 after gaining $0.01 (0.04%) today, slightly underperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. The bears were in full control today, moving the market lower throughout the whole session. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (KEM as at May 22, 2020):
Friday's trading range has been $0.04 (0.15%), that's far below the last trading month's daily average range of $0.08. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly lower than usual for KEM.
Two candlestick patterns are matching today's price action, the Bearish Short Candle and the Black Candle which are both known as bearish patterns.
Prices are trading close to the key technical resistance level at 27.07 (R1). After having been unable to move lower than 27.04 in the previous session, the share found buyers again around the same price level today at 27.04. The last time this happened on Tuesday, KEM gained 0.22% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could accelerate should prices move above the nearby swing high at 27.14 where further buy stops might get triggered. Selling could speed up should prices move below the close-by swing low at 27.02 where further sell stops might get activated. With prices trading close to this year's high at 27.21, upside momentum could accelerate should the stock be able to break out to new highs for the year. As prices are trading close to May's low at 26.97, downside momentum might speed up should KEMET mark new lows for the month.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Decisive Down Move" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for KEMET. Out of 296 times, KEM closed higher 48.65% 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 53.38% with an average market move of 1.67%.