Shares of Crown Holdings (CCK) have worked irregularly lower the past 12 months, and that pattern is likely to persist the next few months.
Looking at this daily bar chart of CCK, above, we can see a September low and then lower January/February lows. Prices firmed from this February nadir, but volume on the advance diminished. A rally needs expanding volume to keep it going and a rally on diminishing volume is suspect. The On-Balance-Volume (OBV) shows some limited improvement, and the momentum study shows a bearish divergence vs. price (a bearish divergence with higher prices and a flat momentum study). Prices have rallied above the 50-day moving average line but it is still pointed down. Prices remain below the 200-day moving average line.
This weekly chart of CCK, above, shows a complex head-and-shoulders top pattern with a "neckline" around $44. The OBV line is flat and the 40-week moving average line is declining. I would anticipate that the recent rally in CCK fails and prices eventually retest the $44 neckline. A close below $44 is likely to precipitate further declines.
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It's hard to call a stock that doubled over the past six months oversold, but that is indeed what we see.
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