ENB.TO closes above its opening price after recovering from early selling pressure
Enbridge Inc (ENB.TO) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
ENB.TO ended the week 4.99% higher at 45.90 after flat today, slightly underperforming the TSX 60 (0.19%). Trading up to $0.46 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. 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 (ENB.TO as at Jan 11, 2019):
Friday's trading range has been $0.53 (1.15%), that's far below the last trading month's daily average range of $1.05. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently significantly higher than usual for ENB.TO. Prices continued to consolidate within a tight trading range between 45.21 and 46.00 where it has been caught now for the last three trading days.
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. Additionally, three candlestick patterns are matching today's price action, the Hanging Man and the Northern Doji which are both known as bearish patterns and one neutral pattern, the Doji. The last time a Doji showed up on December 21, 2018, ENB.TO lost -5.08% on the following trading day.
Prices are trading close to the key technical resistance level at 46.00 (R1). The share ran into sellers again today around 45.96 for the third trading day in a row after having found sellers at 46.00 in the prior session and at 45.93 two days ago.
Crossing below the upper Bollinger Band, prices have lost at least some of their upward momentum in the short-term and could now be heading back down towards the mean of the Bollinger Bands at 43.03.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already. With its 50-day moving average crossing above its 200-day moving average, Enbridge has entered a so-called "Golden Cross" for the first time since November 23, 2018. Showing increasing upward momentum in the short and medium-term the "Golden Cross" is known to indicate a potential bull market on the horizon.
Buying might accelerate should prices move above the nearby swing high at 46.00 where further buy stops could get triggered.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Northern Doji" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Enbridge. Out of 88 times, ENB.TO closed higher 55.68% 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 60.23% with an average market move of 0.76%.