JNJ dominated by bulls lifting the market higher throughout the day
Johnson & Johnson (JNJ) Technical Analysis Report for Sep 18, 2020 | by Techniquant Editorial Team
JNJ finished the week 0.95% higher at 149.18 after gaining $2.01 (1.37%) today, significantly outperforming the Dow Indu. (-0.88%). The bulls were in full control today, moving the market higher throughout the whole session. Closing above Thursday's high at 148.63, the share confirmed its breakout through the previous session high after trading up to $1.02 above it intraday.
Daily Candlestick Chart (JNJ as at Sep 18, 2020):
Friday's trading range has been $3.45 (2.35%), that's slightly above the last trading month's daily average range of $2.90. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for JNJ. Prices continued to consolidate within a tight trading range between 146.05 and 150.59 where it has been caught now for the whole last trading week.
Even with a weak opening Johnson & Johnson managed to close above the prior day's open and close, forming a bullish Engulfing Candle. The last time this candlestick pattern showed up on May 14th, JNJ gained 1.90% on the following trading day. Additionally, one bullish candlestick pattern matches today's price action, the White Candle.
The stock managed to close back above the 100-day moving average at 147.20. Unable to break through the key technical resistance level at 149.64 (R1), the market closed below it after spiking up to 149.65 earlier during the day. The failure to close above the resistance might increase that levels importance going forward. After having been unable to move lower than 146.05 in the previous session, JNJ found buyers again around the same price level today at 146.20.
The share shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying could accelerate should prices move above the nearby swing high at 150.59 where further buy stops might get activated. Further selling could move prices lower should the market test August's close-by low at 145.82.
Among the 11 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Engulfing Candle" stand out. Its common bullish interpretation has been confirmed for Johnson & Johnson. Out of 50 times, JNJ closed higher 54.00% 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 56.00% with an average market move of 0.60%.