AMGN dominated by bears dragging the market lower throughout the day
Amgen Inc. (AMGN) Technical Analysis Report for Jan 24, 2020 | by Techniquant Editorial Team
Moving lower for the 4th day in a row, AMGN finished the week -6.58% lower at 225.59 after tanking $9.45 (-4.02%) today on high volume, notably underperforming the Nasdaq 100 (-0.82%). This is the biggest single-day loss in over a year. Today's close at 225.59 marks the lowest recorded closing price since November 20, 2019. The bears were in full control today, moving the market lower throughout the whole session. Closing below Thursday's low at 233.07, the share confirmed its breakout through the prior session low after trading up to $8.57 below it intraday.
Daily Candlestick Chart (AMGN as at Jan 24, 2020):
Friday's trading range has been $11.38 (4.83%), that's far above the last trading month's daily average range of $3.84. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently significantly higher than usual for AMGN.
One bearish candlestick pattern matches today's price action, the Black Candle.
After trading down to 224.50 earlier during the day, the market bounced off the key technical support level at 225.26 (S1). The failure to close below the support could increase that levels importance as support going forward. When prices bounced off a significant support level the last time on January 13th, AMGN gained 1.30% on the following trading day. Unable to break through the key technical resistance level at 235.80 (R1), Amgen closed below it after spiking up to 235.88 earlier during the day. The failure to close above the resistance might increase that levels significance going forward.
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 while could signal a potential change in momentum that might lead to a correction back up towards the center of the Bollinger Bands at 238.63.
Though the stock is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "RSI(14) below 30" stand out. Its common bullish interpretation has been confirmed for Amgen. Out of 27 times, AMGN closed higher 62.96% 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 two trading days, showing a win rate of 59.26% with an average market move of 0.45%.