MO declines to lowest close since September 11th
Altria Group Inc. (MO) Technical Analysis Report for Oct 12, 2018 | by Techniquant Editorial Team
Moving lower for the 4th day in a row, MO finished the week -3.24% lower at 60.06 after tanking $1.06 (-1.73%) today on high volume, notably underperforming the S&P 500 (1.42%). Today's close at 60.06 marks the lowest recorded closing price since September 11th. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (MO as at Oct 12, 2018):
Friday's trading range has been $1.11 (1.84%), that's slightly below the last trading month's daily average range of $1.16. Things look different on the weekly timeframe, where the market's trading range of the last week has been way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for MO.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
After trading down to 59.50 earlier during the day, the share bounced off the key technical support level at 59.60 (S1). The failure to close below the support might increase that levels importance as support going forward. The stock broke below the 50-day moving average at 60.57 today. When this moving average was crossed below the last time on July 26th, MO actually gained 3.21% on the following trading day.
While the market is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Trading close to August's low at 58.03 we might see further downside momentum if potential sell stops at the level get triggered.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "4 Consecutive Lower Closes" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Altria Group. Out of 53 times, MO closed higher 66.04% 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 54.72% with an average market move of 0.62%.