KSU closes above its opening price after recovering from early selling pressure
Kansas City Southern (KSU) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
KSU ended the week 10.01% higher at 147.25 after edging higher $0.91 (0.62%) today on low volume, slightly outperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Trading up to $1.64 lower after the open, the share managed to reverse during the session as bulls took control ending the day above its opening price. 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 (KSU as at May 22, 2020):
Friday's trading range has been $3.14 (2.14%), that's below the last trading month's daily average range of $3.97. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for KSU. Prices continued to consolidate within a tight trading range between 144.60 and 149.94 where it has been caught now for the last three trading days.
One bullish candlestick pattern matches today's price action, the Bullish Hikkake Pattern.
After trading as low as 144.79 during the day, the stock found support at the 100-day moving average at 145.62. Prices are trading close to the key technical resistance level at 149.94 (R1). After having been unable to move above 148.57 in the prior session, Kansas City ran into sellers again around the same price level today, missing to move higher than 147.93. The last time this happened on May 11th, KSU lost -1.51% on the following trading day.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying could speed up should prices move above the nearby swing high at 149.94 where further buy stops might get activated.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bullish Bounce off SMA 100" stand out. Its common bullish interpretation has been confirmed for Kansas City. Out of 28 times, KSU closed higher 57.14% 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 67.86% with an average market move of 1.53%.