EWH closes below its opening price unable to hold early session gains
iShares MSCI Hong Kong ETF (EWH) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, EWH finished the month 7.71% higher at 21.37 after losing $0.03 (-0.14%) today. Trading $0.05 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (EWH as at Jun 30, 2020):
Tuesday's trading range has been $0.12 (0.56%), that's far below the last trading month's daily average range of $0.26. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly lower than usual for EWH.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
Unable to break through the key technical resistance level at 21.43 (R1), the ETF closed below it after spiking up to 21.45 earlier during the day. The failure to close above the resistance could increase that levels importance going forward. When prices bounced off a significant resistance level the last time on May 21st, EWH lost -5.12% on the following trading day. After having been unable to move above 21.42 in the previous session, EWH ran into sellers again around the same price level today, failing to move higher than 21.45.
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Selling might accelerate should prices move below the nearby swing low at 21.24 where further sell stops could get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to prior High" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for EWH. Out of 408 times, EWH closed higher 53.92% 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 54.66% with an average market move of 0.09%.