GLEN.L breaks back below 50-day moving average
Glencore (GLEN.L) Technical Analysis Report for Nov 09, 2018 | by Techniquant Editorial Team
GLEN.L ended the week -5.41% lower at 303.90 after tanking £14.10 (-4.43%) today, strongly underperforming the FTSE 100 (-0.5%). This is the biggest single-day loss in over a month. The bears were in full control today, moving the market lower throughout the whole session. Ending with a weak close near the low of the day sets a bearish note for the next session.
Daily Candlestick Chart (GLEN.L as at Nov 09, 2018):
Friday's trading range has been £11.60 (3.7%), that's slightly above the last trading month's daily average range of £10.03. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for GLEN.L.
Two candlestick patterns are matching today's price action, the Bullish Hikkake Pattern which is known as bullish pattern and one bearish pattern, the Black Candle.
After trading down to 302.40 earlier during the day, the stock bounced off the key technical support level at 303.05 (S1). The failure to close below the support might increase that levels significance as support going forward. When prices bounced off a significant support level the last time on Monday, GLEN.L actually lost -2.88% on the following trading day. The market closed back below the 50-day moving average at 315.05.
Though the share is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
With prices trading close to this year's low at 284.40, downside momentum might speed up should Glencore break out to new lows for the year. Further selling could move prices lower should the market test October's close-by low at 293.50.
Among the 13 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Very Strong Down Move" stand out. Its common bearish interpretation has been confirmed for Glencore. Out of 119 times, GLEN.L closed lower 57.14% of the time on the next trading day after the market condition occurred.