JNJ finds buyers at key support level
Johnson & Johnson (JNJ) Technical Analysis Report for Aug 04, 2020 | by Techniquant Editorial Team
JNJ ended Tuesday at 147.22 losing $0.13 (-0.09%) on low volume, underperforming the Dow Indu. (0.62%). Trading up to $1.17 lower after the open, the share managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on July 22nd, JNJ actually lost -0.27% on the following trading day. 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 (JNJ as at Aug 04, 2020):
Tuesday's trading range has been $1.40 (0.95%), that's below the last trading month's daily average range of $2.22. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for JNJ.
One bearish candlestick pattern matches today's price action, the Hanging Man.
After trading down to 145.82 earlier during the day, the market bounced off the key technical support level at 145.88 (S1). The failure to close below the support might increase that levels importance as support going forward. Prices are trading close to the key technical resistance level at 148.57 (R1).
While Johnson & Johnson is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Buying might accelerate should prices move above the close-by swing high at 147.79 where further buy stops could get triggered.
Among the five 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 Johnson & Johnson. Out of 443 times, JNJ closed higher 55.76% 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 60.27% with an average market move of 0.46%.