ALL falls to lowest close since July 13th
Allstate Corp (ALL) Technical Analysis Report for Oct 12, 2018 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, ALL ended the week -6.46% lower at 93.16 after losing $0.01 (-0.01%) today, significantly underperforming the S&P 500 (1.42%). Today's close at 93.16 marks the lowest recorded closing price since July 13th. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (ALL as at Oct 12, 2018):
Friday's trading range has been $3.03 (3.2%), that's far above the last trading month's daily average range of $1.42. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently strongly higher than usual for ALL.
One bearish candlestick pattern matches today's price action, the Black Candle.
After trading down to 91.67 earlier during the day, the market bounced off the key technical support level at 92.53 (S1). The failure to close below the support could increase that levels significance as support going forward. When prices bounced off a significant support level the last time on Tuesday, ALL actually lost -3.57% on the following trading day. Prices are trading close to the key technical resistance level at 94.16 (R1).
With another close below the lower Bollinger Band, prices are confirming their strong downward momentum in the short-term. A rally back into the Bollinger Band on the next trading day though might signal a potential change in momentum that could lead to a correction back up towards the center of the Bollinger Bands at 99.09.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close below the lower Bollinger Band" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Allstate Corp. Out of 111 times, ALL closed higher 69.37% 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 75.68% with an average market move of 2.03%.