EWA closes lower for the 2nd day in a row
iShares MSCI Australia ETF (EWA) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, EWA ended the week 4.08% higher at 17.34 after edging lower $0.03 (-0.17%) today ahead of tomorrow's Memorial Day market holiday. Trading up to $0.07 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (EWA as at May 22, 2020):
Friday's trading range has been $0.19 (1.1%), that's far below the last trading month's daily average range of $0.27. 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 EWA.
Two candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns. The last time a Bullish Short Candle showed up on May 15th, EWA gained 4.44% on the following trading day.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying might speed up should prices move above the close-by swing high at 17.71 where further buy stops could get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for EWA. Out of 299 times, EWA closed higher 52.17% 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 55.85% with an average market move of 0.46%.