HPQ still stuck within tight trading range
HP Inc. (HPQ) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
HPQ ended the week 2.17% higher at 21.17 after losing $0.30 (-1.4%) today, significantly underperforming the S&P 500 (-0.01%). Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (HPQ as at Jan 11, 2019):
Friday's trading range has been $0.49 (2.31%), that's below the last trading month's daily average range of $0.67. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for HPQ. Prices continued to consolidate within a tight trading range between 20.74 and 21.53 where it has been caught now for the whole last trading week.
After moving higher in the prior session, the stock closed lower but above the previous day's open today, forming a bearish Harami Candle. The last time this candlestick pattern showed up on July 27, 2018, HPQ lost -0.56% on the following trading day. Additionally, one bearish candlestick pattern matches today's price action, the Hanging Man.
Prices are trading close to the key technical support level at 20.78 (S1).
Though HP is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could accelerate should prices move above the nearby swing high at 21.53 where further buy stops might get triggered.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Harami Candle" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for HP. Out of 59 times, HPQ closed higher 55.93% 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 66.10% with an average market move of 1.89%.