GNW breaks back above 200-day moving average
Genworth Financial Inc (GNW) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, GNW ended Thursday at 4.18 gaining $0.19 (4.76%) on low volume, significantly underperforming the S&P 500 (6.24%). Trading up to $0.10 lower after the open, the share managed to reverse during the session as bulls took control ending the day above its opening price. 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 (GNW as at Mar 26, 2020):
Thursday's trading range has been $0.26 (6.37%), that's below the last trading month's daily average range of $0.42. Things look different on the weekly timeframe, where the market's trading range of the last week has been above the market's average weekly trading range. The longer-term, monthly volatility is currently notably higher than usual for GNW.
One bullish candlestick pattern matches today's price action, the Tweezer Top.
The stock managed to close back above the 200-day moving average at 4.13 for the first time since March 17th. When this moving average was crossed above the last time on March 17th, GNW actually lost -14.89% on the following trading day. Prices are trading close to the key technical resistance level at 4.31 (R1). After having been unable to move above 4.24 in the previous session, the market ran into sellers again around the same price level today, failing to move higher than 4.24.
Though Genworth Financial 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 speed up should prices move above the nearby swing high at 4.52 where further buy stops could get triggered. With prices trading close to this year's high at 4.84, upside momentum might accelerate should GNW be able to break out to new highs for the year.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Tweezer Top" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for Genworth Financial. Out of 54 times, GNW closed lower 61.11% 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 57.41% with an average market move of -0.91%.