KO closes lower for the 2nd day in a row
Coca-Cola Company (KO) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, KO finished the week 4.09% higher at 45.03 after edging lower $0.14 (-0.31%) today, slightly underperforming the Dow Indu. (-0.04%) ahead of tomorrow's Memorial Day market holiday. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (KO as at May 22, 2020):
Friday's trading range has been $0.65 (1.44%), that's far below the last trading month's daily average range of $1.07. 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 KO.
One bullish candlestick pattern matches today's price action, the Bullish Hikkake Pattern.
The stock closed back below the 50-day moving average at 45.05. When this moving average was crossed below the last time on March 5th, KO lost -2.61% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying might accelerate should prices move above the nearby swing high at 46.17 where further buy stops could get triggered. As prices are trading close to May's high at 46.39, upside momentum might speed up should the share mark new highs for the month.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Coca-Cola. Out of 301 times, KO closed higher 52.82% 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 63.12% with an average market move of 0.45%.