TAP runs into sellers around 38.90 for the third day in a row
Molson Coors Brewing Company Class B (TAP) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, TAP finished Thursday at 38.62 gaining $1.08 (2.88%), significantly underperforming the S&P 500 (6.24%). Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (TAP as at Mar 26, 2020):
Thursday's trading range has been $1.46 (3.86%), that's far below the last trading month's daily average range of $3.33. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for TAP. Prices continued to consolidate within a tight trading range between 36.00 and 39.28 where it has been caught now for the last three trading days.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, two candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns. The last time a White Candle showed up on March 16th, TAP gained 5.11% on the following trading day.
After trading down to 37.44 earlier during the day, Molson Coors bounced off the key technical support level at 37.44 (S1). The failure to close below the support might increase that levels significance as support going forward. The market ran into sellers again today around 38.90 for the third trading day in a row after having found sellers at 39.28 in the previous session and at 39.05 two days ago.
Though the share is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Buying might speed up should prices move above the close-by swing high at 39.28 where further buy stops could get triggered.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to prior two Highs" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Molson Coors. Out of 120 times, TAP closed higher 57.50% 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 52.50% with an average market move of 0.27%.