JBHT breaks below key technical support level
J.B. Hunt Transport Services Inc. (JBHT) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
JBHT finished Wednesday at 131.53 losing $1.45 (-1.09%), but still outperforming the Nasdaq 100 (-1.67%). Today's close at 131.53 marks the lowest recorded closing price since August 3rd. The bears were in full control today, moving the market lower throughout the whole session. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (JBHT as at Sep 16, 2020):
Wednesday's trading range has been $2.82 (2.11%), that's slightly below the last trading month's daily average range of $3.08. Things look different on the weekly timeframe, where the market's trading range of the last week has been above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for JBHT.
Three candlestick patterns are matching today's price action, the Last Engulfing Bottom Pattern which is known as bullish pattern and two bearish patterns, the Bearish Hikkake Pattern and the Black Candle. The last time a Bearish Hikkake Pattern showed up on July 15th, JBHT actually gained 1.70% on the following trading day.
Prices broke below the key technical support level at 131.67 (now R1), which is likely to act as resistance going forward. The stock found buyers again today around 131.37 for the third trading day in a row after having found demand at 131.27 in the prior session and at 131.04 two days ago.
Though the share is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Selling could accelerate should prices move below the close-by swing low at 131.04 where further sell stops might get triggered. Further selling could move prices lower should the market test August's nearby low at 129.94.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Hikkake Pattern" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for J. B. Hunt. Out of 124 times, JBHT closed higher 54.84% 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 56.45% with an average market move of 0.91%.