ABC breaks below Thursday's low
AmerisourceBergen Corporation (ABC) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, ABC ended the month -0.58% lower at 100.19 after losing $1.98 (-1.94%) today, significantly underperforming the S&P 500 (0.77%). Closing below Thursday's low at 101.11, the market confirmed its breakout through the prior session low after trading up to $2.42 below it intraday.
Daily Candlestick Chart (ABC as at Jul 31, 2020):
Friday's trading range has been $3.32 (3.25%), that's far above the last trading month's daily average range of $2.26. 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 ABC.
One bearish candlestick pattern matches today's price action, the Black Candle.
After trading as low as 98.69 during the day, the stock found support at the 50-day moving average at 99.25. The last time this happened on January 30th, ABC actually lost -3.74% on the following trading day. The share closed below the 20-day moving average at 101.25 for the first time since July 14th.
Although AmerisourceBergen is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
With prices trading close to this year's high at 105.08, upside momentum might speed up should ABC 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 Technical Indicators based market condition "RSI(2) below 20" stand out. Its common bullish interpretation has been confirmed for AmerisourceBergen. Out of 256 times, ABC closed higher 60.94% 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 60.16% with an average market move of 0.89%.