N100 still stuck within tight trading range
Euronext 100 (N100) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
N100 finished the week 3.77% higher at 890.87 after edging higher €0.01 (0.0%) today. The bulls were in full control today, moving the market higher throughout the whole session. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (N100 as at May 22, 2020):
Friday's trading range has been €19.06 (2.17%), that's slightly above the last trading month's daily average range of €15.96. 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 N100. Prices continued to consolidate within a tight trading range between 872.77 and 902.58 where it has been caught now for the whole last trading week.
Three candlestick patterns are matching today's price action, the Bullish Hikkake Pattern and the White Candle which are both known as bullish patterns and one bearish pattern, the Last Engulfing Top Pattern. The last time a Bullish Hikkake Pattern showed up on May 13th, N100 actually lost -2.07% on the following trading day.
Prices are trading close to the key technical support level at 886.52 (S1).
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying could speed up should prices move above the nearby swing high at 902.58 where further buy stops might get triggered. Further buying could move prices higher should the market test April's close-by high at 926.99.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Last Engulfing Top Pattern" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Euronext. Out of 93 times, N100 closed higher 55.91% 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 63.44% with an average market move of 0.24%.
With three out of the other five Major European Indices closing higher today, the ones that stand out on the positive side are BEL20 gaining 0.75% and TECDAX closing 0.63% higher. On the flipside the worst performers have been FTSE closing -0.37% lower and CAC losing -0.02%. Read more