ES breaks below key technical support level
Eversource Energy (ES) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
ES ended Wednesday at 83.36 losing $0.61 (-0.73%), slightly underperforming the S&P 500 (-0.46%). Trading $0.86 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on September 9th, ES lost -2.86% on the following trading day. 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 (ES as at Sep 16, 2020):
Wednesday's trading range has been $1.15 (1.38%), that's far below the last trading month's daily average range of $1.88. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for ES.
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.
Prices broke below the key technical support level at 83.50 (now R1), which is likely to act as resistance going forward. After having been unable to move lower than 83.23 in the prior session, Eversource Energy found buyers again around the same price level today at 83.31.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying might accelerate should prices move above the close-by swing high at 85.16 where further buy stops could get triggered. Selling might speed up should prices move below the nearby swing low at 81.52 where further sell stops could get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Bearish Intraday Reversal" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Eversource Energy. Out of 387 times, ES closed higher 56.07% 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 59.17% with an average market move of 0.54%.