GWW closes above its opening price after recovering from early selling pressure
W.W. Grainger Inc. (GWW) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
GWW finished Thursday at 249.02 gaining $11.73 (4.94%) on low volume, significantly underperforming the S&P 500 (6.24%). Trading up to $11.65 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (GWW as at Mar 26, 2020):
Thursday's trading range has been $20.95 (8.74%), that's slightly above the last trading month's daily average range of $18.24. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently notably higher than usual for GWW.
One bullish candlestick pattern matches today's price action, the Bullish Closing Marubozu.
Prices are trading close to the key technical resistance level at 251.63 (R1). After having been unable to move lower than 230.56 in the prior session, W. W. Grainger found buyers again around the same price level today at 228.07. The last time this happened on March 19th, GWW actually lost -9.02% on the following trading day.
Although the share 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 accelerate should prices move above the close-by swing high at 255.40 where further buy stops might get triggered.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Closing Marubozu" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for W. W. Grainger. Out of 6 times, GWW closed lower 66.67% 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 66.67% with an average market move of -0.66%.