MNK ends the day indecisive
Mallinckrodt plc (MNK) Technical Analysis Report for May 17, 2019 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, MNK ended the week -9.88% lower at 14.68 after losing $0.48 (-3.17%) today, strongly underperforming the S&P 500 (-0.58%). Today's close at 14.68 marks the lowest recorded closing price since May 10, 2018. Trading $0.45 higher after the open, Mallinckrodt plc was unable to hold its gains as the bears took control ending the day below its opening price. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (MNK as at May 17, 2019):
Friday's trading range has been $0.69 (4.63%), that's slightly below the last trading month's daily average range of $1.01. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for MNK.
One bullish candlestick pattern matches today's price action, the Bullish Hikkake Pattern. The last time a Bullish Hikkake Pattern showed up on Wednesday, MNK actually lost -0.33% on the following trading day.
The market ran into sellers again today around 15.35 for the third trading day in a row after having found sellers at 15.39 in the prior session and at 15.46 two days ago.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
With prices trading close to this year's low at 13.45, downside momentum might accelerate should the share break out to new lows for the year.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "RSI(14) below 30" stand out. Though it is usually interpreted as bullish, it has actually shown to be bearish for Mallinckrodt plc. Out of 19 times, MNK closed lower 68.42% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 57.89% with an average market move of -3.18%.