BRK-B pushes through key technical resistance level
Berkshire Hathaway Inc. (BRK-B) Technical Analysis Report for Jul 28, 2020 | by Techniquant Editorial Team
BRK-B finished Tuesday at 194.12 gaining $1.98 (1.03%), notably outperforming the S&P 500 (-0.65%). The bulls were in full control today, moving the market higher throughout the whole session. Closing above Monday's high at 193.99, the market confirmed its breakout through the previous session high after trading up to $0.47 above it intraday.
Daily Candlestick Chart (BRK-B as at Jul 28, 2020):
Tuesday's trading range has been $3.85 (2.02%), that's above the last trading month's daily average range of $3.06. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for BRK-B.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bullish Outside Bar. Additionally, one bullish candlestick pattern matches today's price action, the White Candle.
Buyers managed to take out the key technical resistance level at 192.68 (now S1), which is likely to act as support going forward. The last time this happened on July 23rd, BRK-B gained 0.66% on the following trading day.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying might accelerate should prices move above the close-by swing high at 196.28 where further buy stops could get activated.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Closed above last periods high" stand out. Its common bullish interpretation has been confirmed for Berkshire Hathaway. Out of 399 times, BRK-B closed higher 50.88% 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 56.89% with an average market move of 0.39%.