GSK.L breaks back below 100-day moving average
GlaxoSmithKline (GSK.L) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, GSK.L ended the week 0.43% higher at 1525.20 after losing £10.80 (-0.7%) today, slightly underperforming the FTSE 100 (-0.36%). Trading £12.00 higher after the open, GlaxoSmithKline was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (GSK.L as at Jan 11, 2019):
Friday's trading range has been £32.40 (2.11%), that's slightly above the last trading month's daily average range of £30.99. 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 notably lower than usual for GSK.L.
One bearish candlestick pattern matches today's price action, the Dark Cloud Cover.
After trading down to 1516.60 earlier during the day, the market bounced off the key technical support level at 1521.20 (S1). The failure to close below the support could increase that levels significance as support going forward. The stock closed back below the 100-day moving average at 1525.99. After having been unable to move lower than 1514.80 in the previous session, the share found buyers again around the same price level today at 1516.60. The last time this happened on Tuesday, GSK.L gained 1.17% on the following trading day.
While GSK.L is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could speed up should prices move above the close-by swing high at 1556.20 where further buy stops might get triggered. Selling could accelerate should prices move below the nearby swing low at 1514.80 where further sell stops might get activated.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Break through SMA 100" stand out. Its common bearish interpretation has been confirmed for GlaxoSmithKline. Out of 73 times, GSK.L closed lower 53.42% of the time on the next trading day after the market condition occurred.