BEL20 runs into sellers again around 2979.41
BEL 20 (BEL20) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
BEL20 finished the week 1.04% higher at 2962.73 after gaining €22.11 (0.75%) today. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (BEL20 as at May 22, 2020):
Friday's trading range has been €87.57 (3.01%), that's above the last trading month's daily average range of €69.26. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for BEL20. Prices continued to consolidate within a tight trading range between 2891.84 and 2998.08 where it has been caught now for the last three trading days.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bullish Outside Bar. In spite of a weak opening the market managed to close above the previous day's open and close, forming a bullish Engulfing Candle. Additionally, one bullish candlestick pattern matches today's price action, the White Candle.
Prices are trading close to the key technical support level at 2930.23 (S1). After having been unable to move above 2977.23 in the prior session, BEL 20 ran into sellers again around the same price level today, missing to move higher than 2979.41. The last time this happened on May 12th, BEL20 lost -3.07% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying might accelerate should prices move above the close-by swing high at 3056.41 where further buy stops could get activated. As prices are trading close to May's high at 3101.29, upside momentum might speed up should the stock index mark new highs for the month. Further selling could move prices lower should the market test April's nearby low at 2820.73.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for BEL 20. Out of 781 times, BEL20 closed higher 50.83% 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 58.77% with an average market move of 0.22%.
With three out of the other five Major European Indices closing higher today, the ones that stand out on the positive side are TECDAX gaining 0.63% and DAX closing 0.07% higher. On the flipside the worst performers have been FTSE closing -0.37% lower and CAC losing -0.02%. Read more