PM breaks below key technical support level
Philip Morris International Inc (PM) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
PM ended the week 1.2% higher at 88.50 after losing $0.32 (-0.36%) today on low volume, underperforming the S&P 500 (0.18%) ahead of tomorrow's Presidents' Day market holiday. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (PM as at Feb 14, 2020):
Friday's trading range has been $1.22 (1.37%), that's below the last trading month's daily average range of $1.63. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for PM.
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. Despite a strong opening the market closed below the prior day's open and close, forming a bearish Engulfing Candle.
Prices broke below the key technical support level at 88.80 (now R1), which is likely to act as resistance going forward. The last time this happened on Wednesday, PM actually gained 1.05% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might accelerate should prices move above the close-by swing high at 89.73 where further buy stops could get activated. Selling might speed up should prices move below the nearby swing low at 87.37 where further sell stops could get triggered.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for Philip Morris. Out of 729 times, PM closed higher 51.03% 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 58.57% with an average market move of 0.48%.