EWP breaks back below 50-day moving average
iShares MSCI Spain Capped ETF (EWP) Technical Analysis Report for Oct 21, 2020 | by Techniquant Editorial Team
EWP ended Wednesday at 22.47 losing $0.31 (-1.36%). Trading $0.13 higher after the open, the ETF was unable to hold its gains as the bears took control ending the day below its opening price. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (EWP as at Oct 21, 2020):
Wednesday's trading range has been $0.20 (0.89%), that's below the last trading month's daily average range of $0.25. 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 EWP.
Prices are trading close to the key technical support level at 22.37 (S1). The market closed back below the 50-day moving average at 22.73. When this moving average was crossed below the last time on October 13th, EWP actually gained 0.58% on the following trading day.
While still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Selling might speed up should prices move below the nearby swing low at 22.11 where further sell stops could get triggered.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Break through SMA 50" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for EWP. Out of 106 times, EWP closed higher 60.38% 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 two trading days, showing a win rate of 52.83% with an average market move of 0.23%.