AEP unable to break through key resistance level
American Electric Power Company Inc. (AEP) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, AEP finished the month -6.58% lower at 79.64 after edging higher $0.07 (0.09%) today, notably underperforming the S&P 500 (1.54%). Trading $1.08 higher after the open, the share was unable to hold its gains as the bears took control ending the day below its opening price. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (AEP as at Jun 30, 2020):
Tuesday's trading range has been $1.72 (2.16%), that's below the last trading month's daily average range of $2.24. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for AEP.
Three candlestick patterns are matching today's price action, the Bearish Hikkake Pattern and the Gravestone Doji which are both known as bearish patterns and one neutral pattern, the Doji.
Unable to break through the key technical resistance level at 80.70 (R1), the market closed below it after spiking up to 80.78 earlier during the day. The failure to close above the resistance might increase that levels importance going forward. When prices bounced off a significant resistance level the last time on June 10th, AEP lost -4.23% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying could accelerate should prices move above the nearby swing high at 81.97 where further buy stops might get activated. Further selling could move prices lower should the market test May's close-by low at 76.23.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Doji" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for American Electric. Out of 129 times, AEP closed higher 56.59% 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 61.24% with an average market move of 0.40%.