ASX runs into sellers again around 5953.90
S&P/ASX 200 Index (ASX) Technical Analysis Report for Jul 01, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, ASX ended Wednesday at 5934.40 gaining $36.50 (0.62%). Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (ASX as at Jul 01, 2020):
Wednesday's trading range has been $61.10 (1.04%), that's far below the last trading month's daily average range of $119.10. 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 ASX.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, two candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns.
Prices are trading close to the key technical resistance level at 5972.50 (R1). After having been unable to move above 5955.20 in the prior session, ASX 200 ran into sellers again around the same price level today, missing to move higher than 5953.90. The last time this happened on Monday, ASX actually gained 1.43% on the following trading day.
The stock index shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying might accelerate should prices move above the nearby swing high at 5955.20 where further buy stops could get triggered.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Higher Closes" stand out. Its common bullish interpretation has been confirmed for ASX 200. Out of 333 times, ASX closed higher 53.75% 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 55.86% with an average market move of 0.17%.