KO closes below its opening price unable to hold early session gains
Coca-Cola Company (KO) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
KO ended Wednesday at 50.79 losing $0.26 (-0.51%), underperforming the Dow Indu. (0.13%). Trading $0.50 higher after the open, the stock was unable to hold its gains as the bears took control ending the day below its opening price. Closing below Tuesday's low at 50.84, the share confirmed its breakout through the prior session low after trading up to $0.10 below it intraday.
Daily Candlestick Chart (KO as at Sep 16, 2020):
Wednesday's trading range has been $0.71 (1.39%), that's below the last trading month's daily average range of $0.96. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for KO.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bearish Outside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Shooting Star. The last time a Shooting Star showed up on August 27th, KO actually gained 3.32% on the following trading day.
After having been unable to move lower than 50.84 in the previous session, the market found buyers again around the same price level today at 50.74.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
As prices are trading close to September's high at 52.14, upside momentum could speed up should Coca-Cola mark new highs for the month.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Close near low of period" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Coca-Cola. Out of 492 times, KO closed higher 56.91% 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 62.40% with an average market move of 0.66%.