MFG.AX runs into sellers again around 27.44
Magellan Fin Group Limited (MFG.AX) Technical Analysis Report for Nov 09, 2018 | by Techniquant Editorial Team
MFG.AX ended the week -0.07% lower at 26.89 after losing $0.55 (-2.0%) today, significantly underperforming the ASX 200 (-0.11%). The bears were in full control today, moving the market lower throughout the whole session. Closing below Thursday's low at 27.24, the share confirmed its breakout through the prior session low after trading up to $0.49 below it intraday.
Daily Candlestick Chart (MFG.AX as at Nov 09, 2018):
Friday's trading range has been $0.69 (2.52%), that's slightly above the last trading month's daily average range of $0.58. Things look different on the weekly timeframe, where the market's trading range of the last week has been below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly lower than usual for MFG.AX.
Two candlestick patterns are matching today's price action, the Black Candle and the Evening Doji Star which are both known as bearish patterns.
After trading down to 26.75 earlier during the day, the market bounced off the key technical support level at 26.76 (S1). The failure to close below the support might increase that levels significance as support going forward. When prices bounced off a significant support level the last time on October 26th, MFG.AX gained 1.92% on the following trading day. Magellan Fin closed back below the 50-day moving average at 27.20. After having been unable to move above 27.52 in the previous session, the stock ran into sellers again around the same price level today, failing to move higher than 27.44.
MFG.AX shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
Buying could speed up should prices move above the close-by swing high at 27.52 where further buy stops might get triggered. Selling could accelerate should prices move below the nearby swing low at 26.29 where further sell stops might get activated.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Closed below last periods low" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Magellan Fin. Out of 265 times, MFG.AX closed higher 57.36% 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 60.75% with an average market move of 1.86%.