PKG rises to highest close since June 8th
Packaging Corporation of America (PKG) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, PKG finished Wednesday at 111.01 surging $3.48 (3.24%), strongly outperforming the S&P 500 (-0.46%). This is the biggest single-day gain in over three weeks. Today's close at 111.01 marks the highest recorded closing price since June 8th. Ending with a strong close near the high of the day sets a bullish note for the next session.
Daily Candlestick Chart (PKG as at Sep 16, 2020):
Wednesday's trading range has been $3.77 (3.46%), that's far above the last trading month's daily average range of $2.54. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for PKG.
One bullish candlestick pattern matches today's price action, the White Candle.
After trading down to 107.84 earlier during the day, the stock bounced off the key technical support level at 108.04 (S1). The failure to close below the support could increase that levels importance as support going forward.
Crossing above the upper Bollinger Band for the first time since September 2nd, prices have shown unusually strong upward momentum in the short-term. This might either indicate a potential buying climax after which prices could head back down towards the mean of the Bollinger Bands at 102.98 or signal the beginning of a strong momentum breakout leading to even higher prices. The last time prices broke out above the upper Bollinger Band on September 1st, PKG gained 2.80% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
With prices trading close to this year's high at 112.89, upside momentum might accelerate should the share be able to break out to new highs for the year.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for Packaging. Out of 438 times, PKG closed higher 59.59% 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 59.13% with an average market move of 0.77%.