GWW closes lower for the 2nd day in a row
W.W. Grainger Inc. (GWW) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, GWW finished the week 5.06% higher at 292.91 after losing $2.53 (-0.86%) today, significantly underperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. The bears were in full control today, moving the market lower throughout the whole session. Closing below Thursday's low at 294.29, the market confirmed its breakout through the previous session low after trading up to $2.83 below it intraday.
Daily Candlestick Chart (GWW as at May 22, 2020):
Friday's trading range has been $4.51 (1.52%), that's far below the last trading month's daily average range of $7.74. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for GWW.
Three candlestick patterns are matching today's price action, the Bullish Hikkake Pattern which is known as bullish pattern and two bearish patterns, the Bearish Short Candle and the Black Candle. The last time a Bearish Short Candle showed up on April 13th, GWW actually gained 4.84% on the following trading day.
Prices are trading close to the key technical support level at 288.12 (S1).
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying might accelerate should prices move above the close-by swing high at 299.40 where further buy stops could get triggered. Selling might speed up should prices move below the nearby swing low at 286.41 where further sell stops could get activated.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Short Candle" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for W. W. Grainger. Out of 67 times, GWW closed higher 56.72% 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 59.70% with an average market move of 0.79%.