AOS closes above its opening price after recovering from early selling pressure
A.O. Smith Corporation (AOS) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, AOS finished Thursday at 37.28 edging higher $0.39 (1.06%) on low volume, strongly underperforming the S&P 500 (6.24%). Trading up to $0.48 lower after the open, A. O. Smith managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (AOS as at Mar 26, 2020):
Thursday's trading range has been $1.41 (3.79%), that's far below the last trading month's daily average range of $2.48. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for AOS.
One neutral candlestick pattern matches today's price action, the Doji. The last time a Doji showed up on December 11, 2019, AOS gained 2.79% on the following trading day.
After having been unable to move above 37.81 in the previous session, the stock ran into sellers again around the same price level today, missing to move higher than 38.17.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Doji" stand out. Though it is usually interpreted as neutral, it has actually shown to be bullish for A. O. Smith. Out of 128 times, AOS closed higher 52.34% 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 64.84% with an average market move of 0.50%.