ZTS dominated by bears dragging the market lower throughout the day
Zoetis Inc. Class A (ZTS) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
ZTS finished Wednesday at 161.25 losing $1.03 (-0.63%), slightly underperforming the S&P 500 (-0.46%). The bears were in full control today, moving the market lower throughout the whole session. Closing below Tuesday's low at 161.70, the share confirmed its breakout through the previous session low after trading up to $0.57 below it intraday.
Daily Candlestick Chart (ZTS as at Sep 16, 2020):
Wednesday's trading range has been $2.86 (1.75%), that's slightly below the last trading month's daily average range of $3.19. 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 ZTS.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar. Even with a strong opening Zoetis closed below the prior day's open and close, forming a bearish Engulfing Candle. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle. The last time a Black Candle showed up on September 8th, ZTS actually gained 3.52% on the following trading day.
Prices are trading close to the key technical support level at 160.98 (S1). After having been unable to move above 163.91 in the previous session, the stock ran into sellers again around the same price level today, failing to move higher than 163.99.
Though the market is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
With prices trading close to this year's high at 165.82, upside momentum might accelerate should ZTS be able to break out to new highs for the year.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Close near low of period" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Zoetis. Out of 374 times, ZTS closed higher 57.75% 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 65.51% with an average market move of 1.49%.