BK still stuck within tight trading range
Bank of New York Mellon Corporation (BK) Technical Analysis Report for Aug 04, 2020 | by Techniquant Editorial Team
BK finished Tuesday at 35.84 losing $0.19 (-0.53%), underperforming the S&P 500 (0.36%). Trading $0.32 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on July 24th, BK lost -1.32% on the following trading day. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (BK as at Aug 04, 2020):
Tuesday's trading range has been $0.65 (1.81%), that's below the last trading month's daily average range of $0.94. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for BK. Prices continued to consolidate within a tight trading range between 35.45 and 36.53 where it has been caught now for the whole last trading week.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
After trading down to 35.63 earlier during the day, Bank of bounced off the key technical support level at 35.72 (S1). The failure to close below the support might increase that levels significance as support going forward. The share closed back below the 100-day moving average at 35.97. The stock found buyers again today around 35.63 for the third trading day in a row after having found demand at 35.52 in the prior session and at 35.57 two days ago.
Although BK is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Buying might accelerate should prices move above the nearby swing high at 36.53 where further buy stops could get triggered. Selling might speed up should prices move below the close-by swing low at 35.52 where further sell stops could get activated.
Among the eight 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 55.43% 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 55.43% with an average market move of 0.48%.