IWC finds support at 20-day moving average
iShares Micro-Cap ETF (IWC) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
IWC ended the month 1.48% higher at 88.56 after losing $1.51 (-1.68%) today. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (IWC as at Jul 31, 2020):
Friday's trading range has been $2.68 (2.97%), that's far above the last trading month's daily average range of $1.65. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for IWC.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar. The last time this happened on July 9th, IWC actually gained 1.99% on the following trading day. Additionally, two candlestick patterns are matching today's price action, the Black Candle and the Dark Cloud Cover which are both known as bearish patterns.
After trading as low as 87.60 during the day, the market found support at the 20-day moving average at 87.73. After having been unable to move above 90.22 in the prior session, the ETF ran into sellers again around the same price level today, failing to move higher than 90.28.
Although IWC is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Buying might accelerate should prices move above the close-by swing high at 90.58 where further buy stops could get triggered.
Among the seven 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 IWC. Out of 388 times, IWC closed higher 61.86% 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 58.25% with an average market move of 0.76%.