AU closes lower for the 4th day in a row
AngloGold Ashanti Limited (AU) Technical Analysis Report for Sep 18, 2020 | by Techniquant Editorial Team
Moving lower for the 4th day in a row, AU finished the week -5.79% lower at 27.17 after losing $0.77 (-2.76%) today, strongly underperforming the S&P 500 (-1.12%). Today's close at 27.17 marks the lowest recorded closing price since June 19th. The bears were in full control today, moving the market lower throughout the whole session. Closing below Thursday's low at 27.72, the market confirmed its breakout through the prior session low after trading up to $0.66 below it intraday.
Daily Candlestick Chart (AU as at Sep 18, 2020):
Friday's trading range has been $1.09 (3.89%), that's slightly below the last trading month's daily average range of $1.16. Things look different on the weekly timeframe, where the market's trading range of the last week has been above the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for AU.
One bearish candlestick pattern matches today's price action, the Black Candle.
Prices are trading close to the key technical support level at 26.32 (S1). After having been unable to move above 28.26 in the previous session, the stock ran into sellers again around the same price level today, missing to move higher than 28.15.
Crossing below the lower Bollinger Band for the first time since August 11th, prices have shown unusually strong downward momentum in the short-term. This might either indicate a potential selling climax after which prices could head back up towards the mean of the Bollinger Bands at 28.86 or signal the beginning of a strong momentum breakout leading to even lower prices. The last time prices broke out below the lower Bollinger Band on August 11th, AU lost -0.79% on the following trading day.
Though still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close crossed below the lower Bollinger Band" stand out. Its common bearish interpretation has been confirmed for AngloGold Ashanti. Out of 66 times, AU closed lower 56.06% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 54.55% with an average market move of -1.56%.