BNS runs into sellers around 42.35 for the forth day in a row
Bank Nova Scotia Halifax Pfd 3 (BNS) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
BNS finished Wednesday at 41.75 losing $0.36 (-0.85%), slightly underperforming the S&P 500 (-0.46%). Trading $0.23 higher after the open, the share was unable to hold its gains as the bears took control ending the day below its opening price. Closing below Tuesday's low at 41.99, Bank Nova confirmed its breakout through the prior session low after trading up to $0.26 below it intraday.
Daily Candlestick Chart (BNS as at Sep 16, 2020):
Wednesday's trading range has been $0.62 (1.47%), that's slightly below the last trading month's daily average range of $0.70. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for BNS.
One bearish candlestick pattern matches today's price action, the Black Candle.
Prices are trading close to the key technical support level at 41.70 (S1). The stock was sold again around 42.35 after having seen highs at 42.36, 42.31 and 42.25 in the last three trading sessions. Obviously there is something going on at that level. The last time this happened on May 11th, BNS lost -1.50% on the following trading day.
Although the market is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Buying could accelerate should prices move above the nearby swing high at 42.36 where further buy stops might get triggered. Selling could speed up should prices move below the close-by swing low at 41.66 where further sell stops might get activated. Further selling could move prices lower should the market test August's nearby low at 40.92.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous two Highs" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Bank Nova. Out of 102 times, BNS closed higher 57.84% of the time on the next trading day after the market condition occurred.