RSP closes within prior day's range after lackluster session
Guggenheim S&P 500 Equal Weight ETF (RSP) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
RSP finished the week 1.65% higher at 118.62 after edging higher $0.02 (0.02%) today ahead of tomorrow's Presidents' Day market holiday. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (RSP as at Feb 14, 2020):
Friday's trading range has been $0.51 (0.43%), that's below the last trading month's daily average range of $0.90. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for RSP. Prices continued to consolidate within a tight trading range between 117.97 and 118.82 where it has been caught now for the last three trading days.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, two candlestick patterns are matching today's price action, the Bearish Spinning Top and the Hanging Man which are both known as bearish patterns. The last time a Hanging Man showed up on January 2nd, RSP lost -0.57% on the following trading day.
Prices are trading close to the key technical support level at 118.18 (S1). The market ran into sellers again today around 118.71 for the third trading day in a row after having found sellers at 118.78 in the previous session and at 118.82 two days ago.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might accelerate should prices move above the close-by swing high at 118.82 where further buy stops could get activated. Selling might speed up should prices move below the nearby swing low at 117.97 where further sell stops could get triggered.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Spinning Top" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for RSP. Out of 199 times, RSP closed higher 61.31% 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 61.31% with an average market move of 0.59%.