RSP breaks below Wednesday's low
Guggenheim S&P 500 Equal Weight ETF (RSP) Technical Analysis Report for Jul 09, 2020 | by Techniquant Editorial Team
RSP finished Thursday at 100.38 losing $1.62 (-1.59%) on high volume. Closing below Wednesday's low at 101.00, the ETF confirmed its breakout through the prior session low after trading up to $1.60 below it intraday.
Daily Candlestick Chart (RSP as at Jul 09, 2020):
Thursday's trading range has been $2.65 (2.6%), that's slightly above the last trading month's daily average range of $2.43. Things look different on the weekly timeframe, where the market's trading range of the last week has been below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for RSP.
One bearish candlestick pattern matches today's price action, the Black Candle.
After trading as low as 99.40 during the day, the market found support at the 50-day moving average at 99.92. The last time this happened on June 26th, RSP gained 1.99% on the following trading day. After having been unable to move above 102.32 in the previous session, RSP ran into sellers again around the same price level today, failing to move higher than 102.05.
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Selling could accelerate should prices move below the nearby swing low at 98.06 where further sell stops might get activated. Further selling could move prices lower should the market test June's close-by low at 98.06.
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 50" stand out. Its common bullish interpretation has been confirmed for RSP. Out of 44 times, RSP closed higher 59.09% 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 61.36% with an average market move of 0.80%.