KSU dominated by bears dragging the market lower throughout the day

Kansas City Southern (KSU) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team


KSU dominated by bears dragging the market lower throughout the day
KSU finds buyers again around 186.01
KSU still stuck within tight trading range
KSU closes within previous day's range


KSU finished Wednesday at 186.65 losing $0.75 (-0.4%), but still slightly outperforming the S&P 500 (-0.46%). 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.

Daily Candlestick Chart (KSU as at Sep 16, 2020):

Daily technical analysis candlestick chart for Kansas City Southern (KSU) as at Sep 16, 2020

Wednesday's trading range has been $3.57 (1.89%), that's slightly below the last trading month's daily average range of $4.90. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for KSU. Prices continued to consolidate within a tight trading range between 182.44 and 189.58 where it has been caught now for the whole last trading week.

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. Despite a strong opening Kansas City closed below the previous day's open and close, forming a bearish Engulfing Candle. The last time this candlestick pattern showed up on August 27th, KSU actually gained 0.99% on the following trading day. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle.

Prices are trading close to the key technical support level at 183.14 (S1). After having been unable to move lower than 186.24 in the prior session, the share found buyers again around the same price level today at 186.01.

The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.

Selling could speed up should prices move below the nearby swing low at 182.44 where further sell stops might get triggered. As prices are trading close to September's low at 181.58, downside momentum could accelerate should the stock mark new lows for the month.

Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Decisive Down Move" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Kansas City. Out of 307 times, KSU closed higher 51.47% 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 62.54% with an average market move of 1.06%.

Market Conditions for KSU as at Sep 16, 2020

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