FE stuck within tight trading range
FirstEnergy Corp. (FE) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
FE ended the week 3.23% higher at 38.37 after losing $0.21 (-0.54%) today, underperforming the S&P 500 (-0.01%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (FE as at Jan 11, 2019):
Friday's trading range has been $0.48 (1.24%), that's far below the last trading month's daily average range of $0.95. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for FE. Prices continued to consolidate within a tight trading range between 37.72 and 38.62 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. After moving higher in the prior session, the market closed lower but above the previous day's open today, forming a bearish Harami Candle.
Prices are trading close to the key technical support level at 37.86 (S1). Prices broke below the key technical support level at 38.42 (now R1), which is likely to act as resistance going forward. After having been unable to move above 38.62 in the prior session, the share ran into sellers again around the same price level today, missing to move higher than 38.57. The last time this happened on Wednesday, FE actually gained 1.66% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might speed up should prices move above the close-by swing high at 38.62 where further buy stops could get activated. 2018's high at 39.88 is within reach and we might see further upside momentum should FirstEnergy manage to break out beyond.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Harami Candle" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for FirstEnergy. Out of 61 times, FE closed higher 55.74% 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 54.10% with an average market move of 0.29%.