KOSPI pushes through Wednesday's high
Korea Composite Stock Price Index (KOSPI) Technical Analysis Report for Jul 02, 2020 | by Techniquant Editorial Team
KOSPI finished Thursday at 2135.37 gaining ₩28.67 (1.36%). The bulls were in full control today, moving the market higher throughout the whole session. Closing above Wednesday's high at 2133.55, the stock index confirmed its breakout through the prior session high after trading up to ₩1.82 above it intraday.
Daily Candlestick Chart (KOSPI as at Jul 02, 2020):
Thursday's trading range has been ₩21.39 (1.01%), that's far below the last trading month's daily average range of ₩40.39. 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 KOSPI. Prices continued to consolidate within a tight trading range between 2087.84 and 2142.04 where it has been caught now for the whole last trading week.
Two candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns. The last time a White Candle showed up on June 24th, KOSPI actually lost -2.27% on the following trading day.
Prices are trading close to the key technical support level at 2112.37 (S1). The index ran into sellers again today around 2135.37 for the third trading day in a row after having found sellers at 2133.55 in the previous session and at 2134.38 two days ago.
Though 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 2101.33 where further sell stops might get activated.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for Korea Composite Index. Out of 584 times, KOSPI closed higher 53.25% 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 53.42% with an average market move of 0.22%.