TAP breaks below key technical support level
Molson Coors Brewing Company Class B (TAP) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
TAP finished the month -9.48% lower at 34.36 after losing $1.06 (-2.99%) today on high volume, strongly underperforming the S&P 500 (1.54%). Today's close at 34.36 marks the lowest recorded closing price since March 31, 2009. Closing below Monday's low at 34.81, Molson Coors confirmed its breakout through the prior session low after trading up to $1.26 below it intraday.
Daily Candlestick Chart (TAP as at Jun 30, 2020):
Tuesday's trading range has been $1.90 (5.36%), that's above the last trading month's daily average range of $1.51. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for TAP.
Two candlestick patterns are matching today's price action, the Last Engulfing Bottom Pattern which is known as bullish pattern and one bearish pattern, the Black Candle. The last time a Last Engulfing Bottom Pattern showed up on May 7th, TAP gained 3.43% on the following trading day.
Prices broke below the key technical support level at 34.63 (now R1), which is likely to act as resistance going forward.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying could accelerate should prices move above the close-by swing high at 35.70 where further buy stops might get triggered.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "52 Week Low" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Molson Coors. Out of 53 times, TAP closed higher 56.60% 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 67.92% with an average market move of 0.64%.