COL breaks below key technical support level
Rockwell Collins (COL) Technical Analysis Report for Oct 12, 2018 | by Techniquant Editorial Team
COL finished the week -4.36% lower at 134.16 after losing $0.18 (-0.13%) today, strongly underperforming the S&P 500 (1.42%). Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (COL as at Oct 12, 2018):
Friday's trading range has been $3.31 (2.44%), that's far above the last trading month's daily average range of $1.74. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for COL.
Prices broke below the key technical support level at 134.30 (now R1), which is likely to act as resistance going forward. The last time this happened on Wednesday, COL actually gained 0.60% on the following trading day.
Crossing above the lower Bollinger Band, prices have lost at least some of their downward momentum in the short-term and might now be heading back up towards the mean of the Bollinger Bands at 139.41.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Selling could speed up should prices move below the nearby swing low at 132.56 where further sell stops might get triggered.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Close to R1 Resistance" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Rockwell Collins. Out of 1,239 times, COL closed higher 50.36% 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 57.63% with an average market move of 0.68%.