ESRX unable to break through key resistance level
Express Scripts Holding Company (ESRX) Technical Analysis Report for Oct 12, 2018 | by Techniquant Editorial Team
ESRX ended the week -1.81% lower at 94.29 after gaining $0.55 (0.59%) today, significantly underperforming the Nasdaq 100 (2.77%). Trading $0.61 higher after the open, Express Scripts 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 missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (ESRX as at Oct 12, 2018):
Friday's trading range has been $1.09 (1.15%), that's slightly below the last trading month's daily average range of $1.49. 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 notably lower than usual for ESRX.
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, two candlestick patterns are matching today's price action, the Homing Pigeon which is known as bullish pattern and one bearish pattern, the Bearish Spinning Top.
Unable to break through the key technical resistance level at 94.92 (R1), the market closed below it after spiking up to 95.10 earlier during the day. The failure to close above the resistance might increase that levels significance going forward. When prices bounced off a significant resistance level the last time on Monday, ESRX actually gained 0.94% on the following trading day.
Though the share is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Selling might speed up should prices move below the close-by swing low at 93.30 where further sell stops could get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Spinning Top" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Express Scripts. Out of 237 times, ESRX closed higher 51.90% 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 60.34% with an average market move of 1.21%.