LQD finds buyers at key support level
iShares iBoxx $ Investment Grade Corporate Bond (LQD) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, LQD finished the month 1.88% higher at 134.50 after gaining $0.38 (0.28%) today. Today's close at 134.50 marks the highest recorded closing price ever. Trading up to $0.49 lower after the open, iShares iBoxx managed to reverse during the session as bulls took control ending the day above 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 (LQD as at Jun 30, 2020):
Tuesday's trading range has been $0.71 (0.53%), that's slightly below the last trading month's daily average range of $0.96. 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 LQD.
After trading down to 133.82 earlier during the day, the ETF bounced off the key technical support level at 134.31 (S1). The failure to close below the support could increase that levels significance as support going forward. When prices bounced off a significant support level the last time on June 11th, LQD gained 0.49% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
With prices trading close to this year's high at 134.90, upside momentum might speed up should the market be able to break out to new highs for the year.
Among the six 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 iShares iBoxx. Out of 397 times, LQD closed higher 63.22% 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 56.17% with an average market move of 0.09%.