MSI dominated by bears dragging the market lower throughout the day
Motorola Solutions Inc. (MSI) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, MSI finished the week 3.97% higher at 134.19 after losing $3.00 (-2.19%) today, significantly underperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. The bears were in full control today, moving the market lower throughout the whole session. Closing below Thursday's low at 136.97, the market confirmed its breakout through the prior session low after trading up to $2.88 below it intraday.
Daily Candlestick Chart (MSI as at May 22, 2020):
Friday's trading range has been $3.20 (2.34%), that's below the last trading month's daily average range of $4.66. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for MSI.
One bearish candlestick pattern matches today's price action, the Black Candle.
Prices broke below the key technical support level at 136.60 (now R1), which is likely to act as resistance going forward. The last time this happened on May 6th, MSI actually gained 0.67% on the following trading day.
While Motorola Solutions is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could speed up should prices move above the nearby swing high at 139.93 where further buy stops might get triggered.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Motorola Solutions. Out of 299 times, MSI closed higher 58.19% 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 56.19% with an average market move of 1.02%.