MNK closes within previous day's range after lackluster session
Mallinckrodt plc (MNK) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
MNK ended the week 7.67% higher at 3.37 after losing $0.01 (-0.3%) today on low volume, underperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. 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 May 22, 2020):
Friday's trading range has been $0.25 (7.44%), that's below the last trading month's daily average range of $0.32. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for MNK.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, four candlestick patterns are matching today's price action, the Gravestone Doji, the Northern Doji and the Shooting Star which are known as bearish patterns and one neutral pattern, the Doji. The last time a Doji showed up on Tuesday, MNK gained 4.04% on the following trading day.
Mallinckrodt plc shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
Buying might speed up should prices move above the nearby swing high at 3.66 where further buy stops could get activated. Selling might accelerate should prices move below the close-by swing low at 3.07 where further sell stops could get triggered. As prices are trading close to May's high at 3.92, upside momentum might speed up should the market mark new highs for the month.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Shooting Star" stand out. Its common bearish interpretation has been confirmed for Mallinckrodt plc. Out of 42 times, MNK closed lower 54.76% 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 57.14% with an average market move of -0.78%.