RSP finds buyers again around 95.34
Guggenheim S&P 500 Equal Weight ETF (RSP) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
RSP finished the week 5.52% higher at 96.30 after edging higher $0.08 (0.08%) today on low volume ahead of tomorrow's Memorial Day market holiday. Trading up to $0.89 lower after the open, the ETF managed to reverse during the session as bulls took control ending the day above its opening price. 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 May 22, 2020):
Friday's trading range has been $1.04 (1.08%), that's far below the last trading month's daily average range of $2.06. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for RSP. Prices continued to consolidate within a tight trading range between 94.32 and 97.18 where it has been caught now for the whole last trading week.
Two candlestick patterns are matching today's price action, the Bullish Spinning Top which is known as bullish pattern and one bearish pattern, the Hanging Man.
Prices are trading close to the key technical resistance level at 96.78 (R1). After having been unable to move lower than 95.64 in the prior session, the market found buyers again around the same price level today at 95.34. The last time this happened on April 24th, RSP gained 2.88% on the following trading day.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying could speed up should prices move above the close-by swing high at 97.18 where further buy stops might get activated. Further buying could move prices higher should the market test April's nearby high at 99.15.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Up Close near high of period" stand out. Its common bullish interpretation has been confirmed for RSP. Out of 699 times, RSP closed higher 53.08% 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 64.81% with an average market move of 0.39%.