CSX finds buyers at key support level
CSX Corporation (CSX) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
CSX ended the week 2.21% higher at 79.59 after losing $0.25 (-0.31%) today, underperforming the Nasdaq 100 (0.29%) ahead of tomorrow's Presidents' Day market holiday. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (CSX as at Feb 14, 2020):
Friday's trading range has been $0.76 (0.95%), that's far below the last trading month's daily average range of $1.32. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for CSX.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. After moving higher in the prior session, the stock closed lower but above the previous day's open today, forming a bearish Harami Candle. Additionally, one bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
After trading down to 79.15 earlier during the day, the share bounced off the key technical support level at 79.19 (S1). The failure to close below the support could increase that levels significance as support going forward. When prices bounced off a significant support level the last time on January 31st, CSX gained 1.00% on the following trading day. After having been unable to move above 79.97 in the prior session, the market ran into sellers again around the same price level today, missing to move higher than 79.91.
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 79.97 where further buy stops could get activated. 2019's high at 80.73 is within reach and we might see further upside momentum should CSX manage to break out beyond.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Harami Candle" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for CSX. Out of 50 times, CSX closed higher 62.00% 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 58.00% with an average market move of 0.80%.