BAC unable to break through key resistance level
Bank of America Corporation (BAC) Technical Analysis Report for Jul 15, 2019 | by Techniquant Editorial Team
BAC finished Monday at 29.22 losing $0.23 (-0.78%), underperforming the S&P 500 (0.02%). Closing below Friday's low at 29.36, the market confirmed its breakout through the prior session low after trading up to $0.28 below it intraday.
Daily Candlestick Chart (BAC as at Jul 15, 2019):
Monday's trading range has been $0.45 (1.53%), that's slightly below the last trading month's daily average range of $0.49. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for BAC.
Notwithstanding a strong opening Bank of closed below the previous day's open and close, forming a bearish Engulfing Candle. Additionally, two candlestick patterns are matching today's price action, the Tweezer Top which is known as bullish pattern and one bearish pattern, the Black Candle.
Unable to break through the key technical resistance level at 29.50 (R1), the share closed below it after spiking up to 29.53 earlier during the day. The failure to close above the resistance might increase that levels importance going forward. The stock ran into sellers again today around 29.53 for the third trading day in a row after having found sellers at 29.53 in the prior session and at 29.50 two days ago. The last time this happened on June 17th, BAC actually gained 2.47% on the following trading day.
Though BAC is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
As prices are trading close to July's high at 29.85, upside momentum might speed up should the market mark new highs for the month. As prices are trading close to July's low at 28.93, downside momentum could accelerate should Bank of mark new lows for the month.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Black Candle" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Bank of. Out of 586 times, BAC closed higher 53.92% 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 53.58% with an average market move of 0.59%.