MCO closes above its opening price after recovering from early selling pressure
Moody's Corporation (MCO) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
MCO finished the week 3.97% higher at 148.97 after edging lower $0.07 (-0.05%) today, slightly underperforming the S&P 500 (-0.01%). Trading up to $0.81 lower after the open, Moody's managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on December 13, 2018, MCO actually lost -2.30% on the following trading day. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (MCO as at Jan 11, 2019):
Friday's trading range has been $2.20 (1.48%), that's far below the last trading month's daily average range of $4.17. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for MCO. Prices continued to consolidate within a tight trading range between 145.02 and 149.58 where it has been caught now for the last three trading days.
Prices are trading close to the key technical resistance level at 151.57 (R1). After having been unable to move above 149.23 in the previous session, the share ran into sellers again around the same price level today, missing to move higher than 149.58.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Selling could speed up should prices move below the close-by swing low at 145.02 where further sell stops might get activated.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to prior High" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Moody's. Out of 618 times, MCO closed higher 52.91% 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 57.93% with an average market move of 1.04%.