CB still stuck within tight trading range
Chubb Limited (CB) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
CB finished the week 1.12% higher at 164.56 after losing $0.27 (-0.16%) today, slightly underperforming the S&P 500 (0.18%) ahead of tomorrow's Presidents' Day market holiday. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (CB as at Feb 14, 2020):
Friday's trading range has been $2.19 (1.33%), that's slightly below the last trading month's daily average range of $2.54. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently notably higher than usual for CB. Prices continued to consolidate within a tight trading range between 162.00 and 165.77 where it has been caught now for the whole last trading week.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar. After moving higher in the prior session, the market closed lower but above the previous day's open today, forming a bearish Harami Candle. Additionally, two candlestick patterns are matching today's price action, the Northern Doji which is known as bearish pattern and one neutral pattern, the Doji. The last time a Doji showed up on January 24th, CB lost -1.07% on the following trading day.
Prices are trading close to the key technical resistance level at 165.77 (R1). After having been unable to move lower than 163.24 in the prior session, Chubb found buyers again around the same price level today at 163.05.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might speed up should prices move above the nearby swing high at 165.77 where further buy stops could get triggered. Selling might accelerate should prices move below the close-by swing low at 162.00 where further sell stops could get activated.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Northern Doji" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Chubb. Out of 52 times, CB closed higher 65.38% 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 61.54% with an average market move of 0.29%.