SSE dominated by bears dragging the market lower throughout the day
SSE Composite Index (SSE) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, SSE ended the week -1.91% lower at 2813.77 after tanking CN¥54.15 (-1.89%) today. This is the biggest single-day loss in over two months. Today's close at 2813.77 marks the lowest recorded closing price since April 28th. The bears were in full control today, moving the market lower throughout the whole session. Ending with a weak close near the low of the day sets a bearish note for the next session.
Daily Candlestick Chart (SSE as at May 22, 2020):
Friday's trading range has been CN¥55.03 (1.92%), that's far above the last trading month's daily average range of CN¥29.84. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for SSE.
One bearish candlestick pattern matches today's price action, the Black Candle.
The stock index closed below the 50-day moving average at 2824.49 for the first time since April 29th. When this moving average was crossed below the last time on March 9th, SSE actually gained 1.82% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Very Strong Down Move" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for SSE Index. Out of 112 times, SSE closed higher 60.71% of the time on the next trading day after the market condition occurred.