HD runs into sellers again around 188.48
Home Depot Inc. (HD) Technical Analysis Report for Nov 09, 2018 | by Techniquant Editorial Team
HD ended the week 3.37% higher at 185.99 after losing $2.01 (-1.07%) today, slightly underperforming the Dow Indu. (-0.77%). 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 (HD as at Nov 09, 2018):
Friday's trading range has been $3.52 (1.87%), that's below the last trading month's daily average range of $4.28. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly lower than usual for HD.
Regardless of a strong opening the share closed below the previous day's open and close, forming a bearish Engulfing Candle. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle.
Prices are trading close to the key technical resistance level at 188.69 (R1). After having been unable to move above 188.69 in the prior session, the stock ran into sellers again around the same price level today, missing to move higher than 188.48. The last time this happened on Tuesday, HD actually gained 2.87% on the following trading day.
Although Home Depot 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 close-by swing high at 188.69 where further buy stops could get triggered.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Black Candle" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Home Depot. Out of 475 times, HD closed higher 51.37% 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 62.74% with an average market move of 1.00%.