ECL slides to lowest close since April 24th
Ecolab Inc. (ECL) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, ECL finished the month -5.97% lower at 187.08 after losing $3.97 (-2.08%) today, notably underperforming the S&P 500 (0.77%). Today's close at 187.08 marks the lowest recorded closing price since April 24th. Closing below Thursday's low at 189.35, Ecolab confirmed its breakout through the previous session low after trading up to $6.08 below it intraday.
Daily Candlestick Chart (ECL as at Jul 31, 2020):
Friday's trading range has been $7.93 (4.17%), that's far above the last trading month's daily average range of $4.85. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for ECL.
The market closed below the 100-day moving average at 190.48 for the first time since April 24th.
Crossing below the lower Bollinger Band for the first time since March 23rd, prices have shown unusually strong downward momentum in the short-term. This could either indicate a potential selling climax after which prices might head back up towards the mean of the Bollinger Bands at 202.84 or signal the beginning of a strong momentum breakout leading to even lower prices. The last time prices broke out below the lower Bollinger Band on March 20th, ECL lost -11.74% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Break through SMA 100" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Ecolab. Out of 60 times, ECL closed higher 58.33% 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 66.67% with an average market move of 0.29%.