GM closes below its opening price unable to hold early session gains
General Motors Company (GM) Technical Analysis Report for May 17, 2019 | by Techniquant Editorial Team
GM finished the week -2.35% lower at 37.00 after losing $0.38 (-1.02%) today, slightly underperforming the S&P 500 (-0.58%). Trading $0.35 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on Monday, GM actually gained 1.31% on the following trading day. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (GM as at May 17, 2019):
Friday's trading range has been $0.51 (1.38%), that's far below the last trading month's daily average range of $0.68. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for GM.
Two candlestick patterns are matching today's price action, the Southern Doji which is known as bullish pattern and one neutral pattern, the Doji.
Prices are trading close to the key technical support level at 36.45 (S1). Prices are trading close to the key technical resistance level at 37.48 (R1).
Though still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Buying could speed up should prices move above the nearby swing high at 37.62 where further buy stops might get triggered. Selling could accelerate should prices move below the close-by swing low at 36.48 where further sell stops might get activated. Trading close to March's low at 36.26 we could see further downside momentum if potential sell stops at the level get triggered.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Southern Doji" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for General Motors. Out of 48 times, GM closed lower 58.33% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 60.42% with an average market move of -0.48%.