GS finds buyers again around 236.23
Goldman Sachs Group Inc. (GS) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, GS ended the week -0.39% lower at 237.08 after losing $1.27 (-0.53%) today on low volume, slightly underperforming the Dow Indu. (-0.09%) ahead of tomorrow's Presidents' Day market holiday. Trading $1.07 higher after the open, the share was unable to hold its gains as the bears took control ending the day below its opening price. 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 (GS as at Feb 14, 2020):
Friday's trading range has been $2.78 (1.17%), that's below the last trading month's daily average range of $3.94. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for GS.
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. The last time this happened on February 6th, GS lost -1.58% on the following trading day.
Prices are trading close to the key technical support level at 235.46 (S1). After having been unable to move lower than 236.57 in the prior session, the stock found buyers again around the same price level today at 236.23.
Though the market is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Buying could accelerate should prices move above the close-by swing high at 241.18 where further buy stops might get triggered. Selling could speed up should prices move below the nearby swing low at 235.46 where further sell stops might get activated. With prices trading close to this year's low at 229.49, downside momentum could accelerate should Goldman Sachs break out to new lows for the year.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous High" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Goldman Sachs. Out of 535 times, GS closed higher 55.89% 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 52.52% with an average market move of 0.19%.