HOG closes lower for the 3rd day in a row
Harley-Davidson Inc. (HOG) Technical Analysis Report for Dec 07, 2018 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, HOG finished the week -9.55% lower at 38.25 after losing $1.20 (-3.04%) today, underperforming the S&P 500 (-2.33%) following today's NFP report. Today's close at 38.25 marks the lowest recorded closing price since October 31st. Ending with a weak close near the low of the day sets a bearish note for the next session.
Daily Candlestick Chart (HOG as at Dec 07, 2018):
Friday's trading range has been $1.79 (4.55%), that's far above the last trading month's daily average range of $1.08. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for HOG.
One bearish candlestick pattern matches today's price action, the Black Candle.
Prices broke below the key technical support level at 38.90 (now R1), which is likely to act as resistance going forward.
Crossing below the lower Bollinger Band for the first time since October 12th, prices have shown unusually strong downward momentum in the short-term. This might either indicate a potential selling climax after which prices could head back up towards the mean of the Bollinger Bands at 41.10 or signal the beginning of a strong momentum breakout leading to even lower prices. The last time prices broke out below the lower Bollinger Band on October 9th, HOG lost -3.13% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close below the lower Bollinger Band" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Harley-Davidson. Out of 134 times, HOG closed higher 53.73% 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 57.46% with an average market move of 1.34%.