FRC closes higher for the 3rd day in a row
FIRST REPUBLIC BANK (FRC) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, FRC finished Wednesday at 108.38 gaining $0.31 (0.29%), outperforming the S&P 500 (-0.46%). Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (FRC as at Sep 16, 2020):
Wednesday's trading range has been $2.21 (2.05%), that's slightly below the last trading month's daily average range of $2.35. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for FRC. Prices continued to consolidate within a tight trading range between 107.05 and 109.57 where it has been caught now for the last three trading days.
Notwithstanding a weak opening the market managed to close above the prior day's open and close, forming a bullish Engulfing Candle. Additionally, one bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
After trading down to 107.36 earlier during the day, the stock bounced off the key technical support level at 107.95 (S1). The failure to close below the support might increase that levels significance as support going forward. FIRST REPUBLIC found buyers again today around 107.36 for the third trading day in a row after having found demand at 107.05 in the previous session and at 107.42 two days ago. The last time this happened on September 4th, FRC actually lost -3.86% on the following trading day.
While 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 accelerate should prices move below the nearby swing low at 107.05 where further sell stops could get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to prior two Lows" stand out. Its common bullish interpretation has been confirmed for FIRST REPUBLIC. Out of 145 times, FRC closed higher 50.34% 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 66.21% with an average market move of 1.13%.