ALL pushes through Thursday's high
Allstate Corporation (ALL) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
ALL ended the month -2.68% lower at 94.39 after gaining $2.31 (2.51%) today, notably outperforming the S&P 500 (0.77%). The bulls were in full control today, moving the market higher throughout the whole session. Closing above Thursday's high at 93.17, the share confirmed its breakout through the prior session high after trading up to $1.31 above it intraday.
Daily Candlestick Chart (ALL as at Jul 31, 2020):
Friday's trading range has been $2.57 (2.79%), that's slightly above the last trading month's daily average range of $2.31. Things look different on the weekly timeframe, where the market's trading range of the last week has been below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for ALL.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bullish Outside Bar. Regardless of a weak opening Allstate managed to close above the previous day's open and close, forming a bullish Engulfing Candle. Additionally, one bullish candlestick pattern matches today's price action, the White Candle.
Buyers managed to take out the key technical resistance level at 92.70 (now S1), which is likely to act as support going forward. The last time this happened on Wednesday, ALL actually lost -2.04% on the following trading day. The stock was bought again around 91.91 after having seen lows at 91.92, 92.25 and 91.96 in the last three trading sessions. Obviously there is something going on at that level.
While the market is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Selling might accelerate should prices move below the nearby swing low at 91.67 where further sell stops could get triggered. As prices are trading close to July's high at 97.43, upside momentum might speed up should ALL mark new highs for the month.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to prior two Lows" stand out. Its common bullish interpretation has been confirmed for Allstate. Out of 103 times, ALL closed higher 53.40% 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 61.17% with an average market move of 0.42%.