MRK closes above its opening price after recovering from early selling pressure
Merck & Company Inc. (MRK) Technical Analysis Report for Mar 15, 2019 | by Techniquant Editorial Team
MRK ended the week 2.22% higher at 81.57 after edging higher $0.08 (0.1%) today on high volume, slightly underperforming the Dow Indu. (0.54%). Trading up to $0.70 lower after the open, Merck & managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (MRK as at Mar 15, 2019):
Friday's trading range has been $1.10 (1.35%), that's slightly above the last trading month's daily average range of $1.03. 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 strongly lower than usual for MRK. Prices continued to consolidate within a tight trading range between 80.80 and 82.01 where it has been caught now for the last three trading days.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bullish Outside Bar. The last time this happened on November 23, 2018, MRK gained 1.03% on the following trading day. Additionally, one bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
Prices are trading close to the key technical resistance level at 82.01 (R1). After having been unable to move lower than 80.93 in the previous session, the market found buyers again around the same price level today at 80.80.
While the share is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Buying could accelerate should prices move above the nearby swing high at 82.01 where further buy stops might get triggered. With prices trading close to this year's high at 82.12, upside momentum could speed up should the stock be able to break out to new highs for the year.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Spinning Top" stand out. Its common bullish interpretation has been confirmed for Merck &. Out of 246 times, MRK closed higher 54.47% 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 58.54% with an average market move of 0.68%.