YUM runs into sellers again around 76.19
Yum! Brands Inc. (YUM) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, YUM finished Thursday at 75.75 gaining $2.88 (3.95%), strongly underperforming the S&P 500 (6.24%). Trading up to $2.35 lower after the open, Yum! Brands managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (YUM as at Mar 26, 2020):
Thursday's trading range has been $4.40 (5.93%), that's slightly below the last trading month's daily average range of $5.65. 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 notably higher than usual for YUM.
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.
Prices are trading close to the key technical resistance level at 76.43 (R1). After having been unable to move above 76.43 in the prior session, the market ran into sellers again around the same price level today, failing to move higher than 76.19. The last time this happened on March 17th, YUM lost -7.33% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying might accelerate should prices move above the nearby swing high at 76.43 where further buy stops could get triggered.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. While it is usually interpreted as neutral, it has actually shown to be bullish for Yum! Brands. Out of 803 times, YUM closed higher 54.05% 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 60.40% with an average market move of 0.61%.