LEG closes within prior day's range
Leggett & Platt Incorporated (LEG) Technical Analysis Report for Mar 15, 2019 | by Techniquant Editorial Team
Moving lower for the 5th day in a row, LEG ended the week -3.0% lower at 43.00 after edging lower $0.06 (-0.14%) today on high volume, underperforming the S&P 500 (0.5%). Today's close at 43.00 marks the lowest recorded closing price since February 4th. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (LEG as at Mar 15, 2019):
Friday's trading range has been $0.63 (1.47%), that's slightly below the last trading month's daily average range of $0.64. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for LEG.
Three candlestick patterns are matching today's price action, the Southern Doji which is known as bullish pattern, one bearish pattern, the Gravestone Doji and one neutral pattern, the Doji.
After having been unable to move lower than 42.80 in the prior session, the share found buyers again around the same price level today at 42.83. The last time this happened on Wednesday, LEG actually lost -1.33% on the following trading day.
With another close below the lower Bollinger Band, prices are confirming their strong downward momentum in the short-term. A rally back into the Bollinger Band on the next trading day though might signal a potential change in momentum that could lead to a correction back up towards the center of the Bollinger Bands at 44.94.
Although the market 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 speed up should prices move below the nearby swing low at 42.80 where further sell stops might get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Southern Doji" stand out. Its common bullish interpretation has been confirmed for Leggett & Platt. Out of 41 times, LEG closed higher 51.22% 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 68.29% with an average market move of 1.48%.