ERIC finds support at 100-day moving average
Ericsson (ERIC) Technical Analysis Report for Jul 16, 2019 | by Techniquant Editorial Team
ERIC finished Tuesday at 9.59 losing $0.03 (-0.31%) on high volume, but still slightly outperforming the S&P 500 (-0.34%) ahead of Wednesday's earnings report. Trading $0.08 higher after the open, the stock was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (ERIC as at Jul 16, 2019):
ERIC is set to report earnings before tomorrow's market open. For the upcoming report, analysts expect the company to have earned $0.07 per share. The company's last earnings report was released on April 17, 2019, when Ericsson reported earnings of $0.09 per share beating market expectations by 80.0%.
Tuesday's trading range has been $0.11 (1.15%), that's slightly below the last trading month's daily average range of $0.11. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for ERIC. Prices continued to consolidate within a tight trading range between 9.57 and 9.71 where it has been caught now for the last three trading days.
Two candlestick patterns are matching today's price action, the Bearish Spinning Top and the Shooting Star which are both known as bearish patterns.
After trading as low as 9.57 during the day, Ericsson found support at the 100-day moving average at 9.58. The market closed back below the 50-day moving average at 9.60. The share found buyers again today around 9.57 for the third trading day in a row after having found demand at 9.58 in the previous session and at 9.57 two days ago. The last time this happened on March 26th, ERIC actually lost -0.97% on the following trading day.
ERIC shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
Buying could speed up should prices move above the nearby swing high at 9.71 where further buy stops might get triggered. Selling could accelerate should prices move below the close-by swing low at 9.45 where further sell stops might get activated.
Among the 13 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bullish Bounce off SMA 100" stand out. Its common bullish interpretation has been confirmed for Ericsson. Out of 26 times, ERIC closed higher 69.23% 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 65.38% with an average market move of 1.21%.