EWU closes below its opening price unable to hold early session gains
iShares MSCI United Kingdom ETF (EWU) Technical Analysis Report for Aug 05, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, EWU finished Wednesday at 26.71 gaining $0.20 (0.75%). Trading $0.10 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on July 24th, EWU actually gained 0.88% on the following trading day.
Daily Candlestick Chart (EWU as at Aug 05, 2020):
Wednesday's trading range has been $0.22 (0.82%), that's below the last trading month's daily average range of $0.33. 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 EWU.
Unable to break through the key technical resistance level at 26.90 (R1), the ETF closed below it after spiking up to 26.92 earlier during the day. The failure to close above the resistance might increase that levels importance going forward.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the six 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. While it is usually interpreted as bearish, it has actually shown to be bullish for EWU. Out of 428 times, EWU closed higher 53.27% 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 54.21% with an average market move of 0.11%.