KHC closes within previous day's range after lackluster session
The Kraft Heinz Company (KHC) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
KHC ended the week 2.57% higher at 29.95 after gaining $0.24 (0.81%) today on low volume, slightly outperforming the Nasdaq 100 (0.38%) ahead of tomorrow's Memorial Day market holiday. The bulls were in full control today, moving the market higher throughout the whole session. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (KHC as at May 22, 2020):
Friday's trading range has been $0.43 (1.45%), that's far below the last trading month's daily average range of $0.79. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for KHC.
Two candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns. The last time a White Candle showed up on Monday, KHC actually lost -3.11% on the following trading day.
Buyers managed to take out the key technical resistance level at 29.72 (now S1), which is likely to act as support going forward. After having been unable to move lower than 29.59 in the prior session, The Kraft found buyers again around the same price level today at 29.56.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to previous low" stand out. Although it is usually interpreted as bullish, it has actually shown to be bearish for The Kraft. Out of 274 times, KHC closed lower 52.92% 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 52.19% with an average market move of -0.92%.