MNK closes within prior day's range after lackluster session
Mallinckrodt plc (MNK) Technical Analysis Report for Apr 16, 2019 | by Techniquant Editorial Team
Moving lower for the 6th day in a row, MNK finished Tuesday at 21.66 edging lower $0.04 (-0.18%) on low volume, slightly underperforming the S&P 500 (0.05%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (MNK as at Apr 16, 2019):
Tuesday's trading range has been $0.51 (2.32%), that's far below the last trading month's daily average range of $0.85. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for MNK.
Three candlestick patterns are matching today's price action, the Last Engulfing Bottom Pattern which is known as bullish pattern and two bearish patterns, the Bearish Short Candle and the Black Candle. The last time a Bearish Short Candle showed up on January 29th, MNK actually gained 2.78% on the following trading day.
Prices are trading close to the key technical resistance level at 21.74 (R1). After having been unable to move above 21.96 in the previous session, the stock ran into sellers again around the same price level today, missing to move higher than 22.04.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Selling could speed up should prices move below the close-by swing low at 21.16 where further sell stops might get triggered. Further selling could move prices lower should the market test March's nearby low at 20.40.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "6 Consecutive Lower Closes" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Mallinckrodt plc. Out of 10 times, MNK closed higher 60.00% of the time on the next trading day after the market condition occurred.