INFO finds buyers at key support level
IHS Markit Ltd. (INFO) Technical Analysis Report for Feb 20, 2020 | by Techniquant Editorial Team
INFO finished Thursday at 80.44 losing $0.67 (-0.83%), slightly underperforming the S&P 500 (-0.38%). Trading $0.56 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (INFO as at Feb 20, 2020):
Thursday's trading range has been $1.54 (1.9%), that's far above the last trading month's daily average range of $1.08. Things look different on the weekly timeframe, where the market's trading range of the last week has been below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for INFO. Prices continued to consolidate within a tight trading range between 79.95 and 81.65 where it has been caught now for the whole last trading week.
After trading down to 79.95 earlier during the day, the stock bounced off the key technical support level at 80.15 (S1). The failure to close below the support could increase that levels significance as support going forward. When prices bounced off a significant support level the last time on Tuesday, INFO gained 1.02% on the following trading day. After having been unable to move above 81.65 in the prior session, the share ran into sellers again around the same price level today, missing to move higher than 81.49.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
As prices are trading close to February's low at 78.89, downside momentum might speed up should IHS Markit mark new lows for the month.
Among the three 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 IHS Markit. Out of 285 times, INFO closed higher 57.19% 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 68.42% with an average market move of 1.37%.