BARC.L runs into sellers again around 170.50
Barclays (BARC.L) Technical Analysis Report for Oct 12, 2018 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, BARC.L ended the week -4.59% lower at 165.00 after losing £3.00 (-1.79%) today, notably underperforming the FTSE 100 (-0.16%). Today's close at 165.00 marks the lowest recorded closing price since September 16, 2016. Trading £2.80 higher after the open, the stock was unable to hold its gains as the bears took control ending the day below its opening price. Closing below Thursday's low at 167.32, Barclays confirmed its breakout through the previous session low after trading up to £2.38 below it intraday.
Daily Candlestick Chart (BARC.L as at Oct 12, 2018):
Friday's trading range has been £5.56 (3.32%), that's far above the last trading month's daily average range of £3.31. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for BARC.L.
Unable to break through the key technical resistance level at 168.34 (R1), the share closed below it after spiking up to 170.50 earlier during the day. The failure to close above the resistance could increase that levels importance going forward. After having been unable to move above 170.86 in the prior session, the market ran into sellers again around the same price level today, failing to move higher than 170.50.
Crossing below the lower Bollinger Band for the first time since Tuesday, 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 172.17 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 Tuesday, BARC.L actually gained 2.31% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the 11 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "52 Week Low" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Barclays. Out of 70 times, BARC.L closed higher 52.86% 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 60.00% with an average market move of 2.04%.