AOS closes within previous day's range
A.O. Smith Corporation (AOS) Technical Analysis Report for May 14, 2020 | by Techniquant Editorial Team
AOS finished Thursday at 40.28 edging higher $0.30 (0.75%), slightly underperforming the S&P 500 (1.15%). Trading up to $1.03 lower after the open, the stock 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 failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (AOS as at May 14, 2020):
Thursday's trading range has been $1.84 (4.65%), that's far above the last trading month's daily average range of $1.34. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for AOS.
One bearish candlestick pattern matches today's price action, the In-Neck Pattern.
After trading down to 38.51 earlier during the day, A. O. Smith bounced off the key technical support level at 39.46 (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 April 24th, AOS gained 5.30% on the following trading day. Prices are trading close to the key technical resistance level at 41.14 (R1).
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 Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for A. O. Smith. Out of 417 times, AOS closed higher 59.71% 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 61.63% with an average market move of 0.99%.