EFA closes below its opening price unable to hold early session gains
iShares MSCI EAFE ETF (EFA) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
EFA ended Wednesday at 65.57 flat. Trading $0.26 higher after the open, EAFE ETF was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (EFA as at Sep 16, 2020):
Wednesday's trading range has been $0.56 (0.85%), that's slightly below the last trading month's daily average range of $0.70. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for EFA. Prices continued to consolidate within a tight trading range between 65.10 and 66.02 where it has been caught now for the last three trading days.
Prices are trading close to the key technical support level at 65.37 (S1). After having been unable to move lower than 65.43 in the prior session, the ETF found buyers again around the same price level today at 65.46. The last time this happened on September 8th, EFA gained 1.87% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the three 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 EAFE ETF. Out of 427 times, EFA closed higher 57.38% 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 58.78% with an average market move of 0.25%.