SSE closes within prior day's range
SSE Composite Index (SSE) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
SSE ended the month 10.9% higher at 3310.01 after gaining CN¥23.19 (0.71%) today. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (SSE as at Jul 31, 2020):
Friday's trading range has been CN¥72.18 (2.2%), that's slightly below the last trading month's daily average range of CN¥80.92. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly lower than usual for SSE.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bullish Outside Bar. The last time this happened on July 13th, SSE actually lost -0.83% on the following trading day. Additionally, one bearish candlestick pattern matches today's price action, the Last Engulfing Top Pattern.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "RSI(2) above 80" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for SSE Index. Out of 270 times, SSE closed higher 55.56% 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 58.15% with an average market move of 0.28%.