MLM closes above its opening price after recovering from early selling pressure
Martin Marietta Materials Inc. (MLM) Technical Analysis Report for Jan 15, 2020 | by Techniquant Editorial Team
MLM finished Wednesday at 262.19 gaining $1.44 (0.55%), slightly outperforming the S&P 500 (0.19%). Trading up to $1.96 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (MLM as at Jan 15, 2020):
Wednesday's trading range has been $4.01 (1.54%), that's slightly below the last trading month's daily average range of $4.35. Things look different on the weekly timeframe, where the market's trading range of the last week has been way above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for MLM.
After trading down to 258.77 earlier during the day, the stock bounced off the key technical support level at 259.50 (S1). The failure to close below the support might increase that levels significance as support going forward. When prices bounced off a significant support level the last time on January 10th, MLM actually lost -1.70% on the following trading day. Prices are trading close to the key technical resistance level at 264.11 (R1).
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 although could signal a potential change in momentum that might lead to a correction back up towards the center of the Bollinger Bands at 274.36.
While still in a long-term uptrend, the short and medium-term trends both turned bearish already.
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 Martin Marietta. Out of 430 times, MLM closed higher 58.60% 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 54.65% with an average market move of 0.76%.