COST closes higher for the 2nd day in a row
Costco Co. (COST) Technical Analysis Report for Oct 12, 2018
Moving higher for the 2nd day in a row, COST finished the week 3.72% higher at 226.95 after surging $5.13 (2.31%) today, slightly underperforming the Nasdaq 100 (2.77%). This is the biggest single-day gain in over five months. Today's close at 226.95 marks the highest recorded closing price since October 4th. Trading up to $1.80 lower after the open, Costco Co. managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on Tuesday, COST actually lost -1.39% on the following trading day. Closing above Thursday's high at 225.32, the share confirmed its breakout through the prior session high after trading up to $2.30 above it intraday.
Daily Candlestick Chart (COST as at Oct 12, 2018):
Friday's trading range has been $4.22 (1.87%), that's slightly above the last trading month's daily average range of $3.41. 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 higher than usual for COST.
After trading down to 223.40 earlier during the day, the stock bounced off the key technical support level at 225.15 (S1). The failure to close below the support could increase that levels significance as support going forward.
Though 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.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for Costco Co.. Out of 415 times, COST closed higher 59.04% 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 57.59% with an average market move of 0.88%.