EWA finds buyers at key support level
iShares MSCI Australia ETF (EWA) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
EWA finished the week 2.04% higher at 23.05 after gaining $0.06 (0.26%) today ahead of tomorrow's Presidents' Day market holiday. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (EWA as at Feb 14, 2020):
Friday's trading range has been $0.12 (0.52%), that's slightly below the last trading month's daily average range of $0.14. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for EWA.
After trading down to 22.98 earlier during the day, the ETF bounced off the key technical support level at 23.02 (S1). The failure to close below the support could increase that levels significance as support going forward. When prices bounced off a significant support level the last time on January 27th, EWA gained 0.84% on the following trading day. After having been unable to move above 23.07 in the previous session, the market ran into sellers again around the same price level today, missing to move higher than 23.10.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might accelerate should prices move above the close-by swing high at 23.14 where further buy stops could get activated. Selling might speed up should prices move below the nearby swing low at 22.94 where further sell stops could get triggered.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for EWA. Out of 333 times, EWA closed higher 61.26% 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 56.46% with an average market move of 0.08%.