MDLZ pushes through key technical resistance level
Mondelez International Inc. (MDLZ) Technical Analysis Report for Aug 12, 2020 | by Techniquant Editorial Team
MDLZ finished Wednesday at 56.03 surging $0.83 (1.5%), strongly underperforming the Nasdaq 100 (2.59%). The bulls were in full control today, moving the market higher throughout the whole session. Closing above Tuesday's high at 55.89, Mondelez International confirmed its breakout through the prior session high after trading up to $0.51 above it intraday.
Daily Candlestick Chart (MDLZ as at Aug 12, 2020):
Wednesday's trading range has been $1.37 (2.49%), that's far above the last trading month's daily average range of $0.92. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for MDLZ.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bullish Outside Bar. Despite a weak opening the stock managed to close above the previous day's open and close, forming a bullish Engulfing Candle. Additionally, one bullish candlestick pattern matches today's price action, the White Candle.
Buyers managed to take out the key technical resistance level at 55.96 (now S1), which is likely to act as support going forward. The last time this happened on July 21st, MDLZ gained 0.94% on the following trading day. After having been unable to move lower than 55.06 in the prior session, the market found buyers again around the same price level today at 55.03.
While the share is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Engulfing Candle" stand out. Its common bullish interpretation has been confirmed for Mondelez International. Out of 65 times, MDLZ closed higher 53.85% 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 58.46% with an average market move of 0.46%.