HMC finds buyers again around 25.42
Honda Motor Company Ltd. (HMC) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
HMC finished the month -1.88% lower at 25.56 after losing $0.02 (-0.08%) today, significantly underperforming the S&P 500 (1.54%). Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (HMC as at Jun 30, 2020):
Tuesday's trading range has been $0.21 (0.82%), that's far below the last trading month's daily average range of $0.46. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently notably lower than usual for HMC.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, two candlestick patterns are matching today's price action, the Takuri Line which is known as bullish pattern and one bearish pattern, the Bearish Spinning Top. The last time a Takuri Line showed up on March 13th, HMC actually lost -7.83% on the following trading day.
Unable to break through the key technical resistance level at 25.59 (R1), the stock closed below it after spiking up to 25.63 earlier during the day. The failure to close above the resistance might increase that levels importance going forward. After having been unable to move lower than 25.38 in the previous session, Honda Motor found buyers again around the same price level today at 25.42.
The market shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Selling could speed up should prices move below the close-by swing low at 25.20 where further sell stops might get triggered.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Resistance R1" stand out. Its common bearish interpretation has been confirmed for Honda Motor. Out of 269 times, HMC closed lower 63.57% 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 53.16% with an average market move of -0.26%.