KOSPI closes lower for the 2nd day in a row
Korea Composite Stock Price Index (KOSPI) Technical Analysis Report for Sep 17, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, KOSPI ended Thursday at 2406.17 losing ₩29.75 (-1.22%). Closing below Wednesday's low at 2429.94, the index confirmed its breakout through the previous session low after trading up to ₩31.25 below it intraday.
Daily Candlestick Chart (KOSPI as at Sep 17, 2020):
Thursday's trading range has been ₩38.33 (1.58%), that's above the last trading month's daily average range of ₩29.68. 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 lower than usual for KOSPI.
One bearish candlestick pattern matches today's price action, the Black Candle. The last time a Black Candle showed up on August 31st, KOSPI actually gained 1.01% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Selling could speed up should prices move below the nearby swing low at 2374.00 where further sell stops might get activated. With prices trading close to this year's high at 2458.17, upside momentum could accelerate should the market be able to break out to new highs for the year.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Down Close Near Low of Period" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Korea Composite Index. Out of 416 times, KOSPI closed higher 59.38% 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 two trading days, showing a win rate of 55.29% with an average market move of 0.07%.