FERG.L closes within previous day's range after lackluster session
Ferguson plc (FERG.L) Technical Analysis Report for Dec 07, 2018 | by Techniquant Editorial Team
FERG.L ended the week -3.87% lower at 4825.50 after gaining £49.00 (1.03%) today, slightly underperforming the FTSE 100 (1.1%). 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 (FERG.L as at Dec 07, 2018):
Friday's trading range has been £85.00 (1.77%), that's below the last trading month's daily average range of £123.65. Things look different on the weekly timeframe, where the market's trading range of the last week has been way above the market's average weekly trading range. The longer-term, monthly volatility is currently just the same than usual for FERG.L.
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 lower in the prior session, Ferguson plc managed to close higher but below the previous day's open, forming a bullish Harami Candle. Additionally, one bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
Prices are trading close to the key technical resistance level at 4917.00 (R1). After having been unable to move above 4890.00 in the prior session, the share ran into sellers again around the same price level today, missing to move higher than 4878.50. The last time this happened on November 30th, FERG.L actually gained 3.57% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Selling might speed up should prices move below the close-by swing low at 4711.50 where further sell stops could get activated. With prices trading close to this year's low at 4688.50, downside momentum might accelerate should the stock break out to new lows for the year.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous High" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Ferguson plc. Out of 93 times, FERG.L closed higher 53.76% 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 61.29% with an average market move of 0.41%.