HIG finds buyers at key support level
Hartford Financial Services Group Inc. (HIG) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
HIG ended the month 9.78% higher at 42.32 after surging $1.82 (4.49%) today on high volume, strongly outperforming the S&P 500 (0.77%) following Thursday's earnings report. This is the biggest single-day gain in over two weeks. Trading up to $1.22 lower after the open, Hartford Financial managed to reverse during the session as bulls took control ending the day above its opening price. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (HIG as at Jul 31, 2020):
HIG reported earnings of $1.22 per share after Thursday's market close. With analysts having expected an EPS of $1.22, Hartford Financial Services Group Inc. hit market expectations. The company's last earnings report was released on April 29, 2020, when Hartford Financial Services Group Inc. reported earnings of $1.34 per share hitting market expectations.
Friday's trading range has been $1.96 (4.67%), that's far above the last trading month's daily average range of $1.31. 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 slightly lower than usual for HIG.
Two candlestick patterns are matching today's price action, the Bullish Spinning Top and the Takuri Line which are both known as bullish patterns.
After trading down to 40.78 earlier during the day, the market bounced off the key technical support level at 41.28 (S1). The failure to close below the support might increase that levels significance as support going forward. When prices bounced off a significant support level the last time on May 8th, HIG actually lost -3.91% on the following trading day.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
As prices are trading close to July's high at 43.12, upside momentum could speed up should the stock mark new highs for the month.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for Hartford Financial. Out of 476 times, HIG closed higher 57.77% 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 58.19% with an average market move of 0.64%.