YUM finds buyers again around 88.51
Yum! Brands Inc. (YUM) Technical Analysis Report for May 29, 2020 | by Techniquant Editorial Team
YUM finished the month 3.82% higher at 89.73 after losing $1.12 (-1.23%) today on high volume, significantly underperforming the S&P 500 (0.48%). Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (YUM as at May 29, 2020):
Friday's trading range has been $2.41 (2.67%), that's slightly below the last trading month's daily average range of $2.57. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for YUM. Prices continued to consolidate within a tight trading range between 88.23 and 91.31 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, one bearish candlestick pattern matches today's price action, the Bearish Spinning Top. The last time a Bearish Spinning Top showed up on April 2nd, YUM lost -4.16% on the following trading day.
After having been unable to move lower than 88.23 in the previous session, the stock found buyers again around the same price level today at 88.51.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying might accelerate should prices move above the close-by swing high at 91.31 where further buy stops could get activated. Selling might speed up should prices move below the nearby swing low at 88.23 where further sell stops could get triggered. Trading close to March's high at 94.89 we might see further upside momentum if potential buy stops at the level get activated.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Spinning Top" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Yum! Brands. Out of 223 times, YUM closed higher 52.91% 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 61.88% with an average market move of 0.32%.