FIX closes below its opening price unable to hold early session gains
Comfort Systems USA Inc. (FIX) Technical Analysis Report for Apr 02, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, FIX finished Thursday at 34.30 edging lower $0.45 (-1.29%), significantly underperforming the S&P 500 (2.28%). Trading $2.08 higher after the open, the stock was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on March 25th, FIX actually gained 11.35% on the following trading day. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (FIX as at Apr 02, 2020):
Thursday's trading range has been $2.70 (7.83%), that's below the last trading month's daily average range of $3.40. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for FIX. Prices continued to consolidate within a tight trading range between 32.30 and 36.55 where it has been caught now for the whole last trading week.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
Unable to break through the key technical resistance level at 36.04 (R1), the market closed below it after spiking up to 36.55 earlier during the day. The failure to close above the resistance might increase that levels importance going forward. The share found buyers again today around 33.85 for the third trading day in a row after having found demand at 33.91 in the prior session and at 34.29 two days ago.
Although Comfort Systems is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Buying might accelerate should prices move above the nearby swing high at 36.55 where further buy stops could get triggered. Selling might speed up should prices move below the close-by swing low at 32.30 where further sell stops could get activated. With prices trading close to this year's low at 29.43, downside momentum might accelerate should FIX break out to new lows for the year.
Among the 11 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Down Close Near Low of Period" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Comfort Systems. Out of 457 times, FIX closed higher 54.92% 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 58.21% with an average market move of 1.06%.