RSP closes lower for the 2nd day in a row
Guggenheim S&P 500 Equal Weight ETF (RSP) Technical Analysis Report for May 29, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, RSP ended the month 4.75% higher at 100.71 after edging lower $0.15 (-0.15%) today. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (RSP as at May 29, 2020):
Friday's trading range has been $3.66 (3.56%), that's far above the last trading month's daily average range of $2.12. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for RSP.
Despite a strong opening the ETF closed below the previous day's open and close, forming a bearish Engulfing Candle. Additionally, two candlestick patterns are matching today's price action, the Tweezer Top which is known as bullish pattern and one bearish pattern, the Black Candle. The last time a Tweezer Top showed up on April 24th, RSP gained 2.88% on the following trading day.
After trading as low as 99.12 during the day, the market found support at the 100-day moving average at 100.30. After having been unable to move above 102.78 in the prior session, RSP ran into sellers again around the same price level today, failing to move higher than 102.78.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bullish Bounce off SMA 100" stand out. Its common bullish interpretation has been confirmed for RSP. Out of 23 times, RSP closed higher 52.17% 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 78.26% with an average market move of 1.36%.