DCC.L pushes through key technical resistance level
DCC plc (DCC.L) Technical Analysis Report for Dec 07, 2018 | by Techniquant Editorial Team
DCC.L finished the week -1.52% lower at 5815.00 after gaining £135.00 (2.38%) today, significantly outperforming the FTSE 100 (1.1%). Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (DCC.L as at Dec 07, 2018):
Friday's trading range has been £145.00 (2.52%), that's slightly below the last trading month's daily average range of £174.25. 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 lower than usual for DCC.L.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. After moving lower in the previous session, the market managed to close higher but below the prior day's open, forming a bullish Harami Candle.
Buyers managed to take out the key technical resistance level at 5750.00 (now S1), which is likely to act as support going forward. The last time this happened on November 9th, DCC.L actually lost -2.20% on the following trading day.
While the share is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Selling might speed up should prices move below the close-by swing low at 5670.00 where further sell stops could get activated. With prices trading close to this year's low at 5555.00, downside momentum might accelerate should DCC plc break out to new lows for the year.
Among the three 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 DCC plc. Out of 767 times, DCC.L closed higher 49.67% 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 59.06% with an average market move of 1.12%.