BK closes below its opening price unable to hold early session gains
Bank of New York Mellon Corporation (BK) Technical Analysis Report for Dec 07, 2018 | by Techniquant Editorial Team
Moving lower for the 4th day in a row, BK finished the week -7.02% lower at 47.71 after edging lower $0.13 (-0.27%) today, but still notably outperforming the S&P 500 (-2.33%) following today's NFP report. Today's close at 47.71 marks the lowest recorded closing price since November 2nd. Trading $0.78 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 within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (BK as at Dec 07, 2018):
Friday's trading range has been $1.19 (2.49%), that's slightly above the last trading month's daily average range of $1.10. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for BK.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top. The last time a Bearish Spinning Top showed up on November 14th, BK actually gained 2.05% on the following trading day.
After trading down to 47.39 earlier during the day, the market bounced off the key technical support level at 47.65 (S1). The failure to close below the support might increase that levels significance as support going forward.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Selling could speed up should prices move below the nearby swing low at 46.67 where further sell stops might get triggered.
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 Bank of. Out of 433 times, BK closed higher 54.50% 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 55.66% with an average market move of 0.39%.