BSX pushes through key technical resistance level
Boston Scientific Corporation (BSX) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
BSX ended the week 3.1% higher at 35.91 after gaining $1.12 (3.22%) today on high volume, strongly outperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (BSX as at May 22, 2020):
Friday's trading range has been $1.05 (2.95%), that's below the last trading month's daily average range of $1.22. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for BSX.
Buyers managed to take out the key technical resistance level at 35.72 (now S1), which is likely to act as support going forward. After having been unable to move above 36.13 in the prior session, the share ran into sellers again around the same price level today, missing to move higher than 36.32. The last time this happened on May 11th, BSX lost -2.12% on the following trading day.
Boston Scientific shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying might speed up should prices move above the close-by swing high at 37.49 where further buy stops could get activated. Selling might accelerate should prices move below the nearby swing low at 34.45 where further sell stops could get triggered. As prices are trading close to May's high at 38.36, upside momentum might speed up should the stock mark new highs for the month.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. Though it is usually interpreted as neutral, it has actually shown to be bullish for Boston Scientific. Out of 710 times, BSX closed higher 52.54% 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 60.42% with an average market move of 1.33%.