NCLH unable to break through key resistance level
Norwegian Cruise Line Holdings Ltd. (NCLH) Technical Analysis Report for Oct 12, 2018 | by Techniquant Editorial Team
NCLH finished the week -6.53% lower at 50.70 after edging higher $0.08 (0.16%) today on high volume, strongly underperforming the Nasdaq 100 (2.77%). Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (NCLH as at Oct 12, 2018):
Friday's trading range has been $1.62 (3.15%), that's above the last trading month's daily average range of $1.21. Weekly volatility is also higher, being above the market's average weekly trading range. The longer-term, monthly volatility is currently notably higher than usual for NCLH.
After trading down to 49.99 earlier during the day, Norwegian Cruise bounced off the key technical support level at 50.26 (S1). The failure to close below the support could increase that levels significance as support going forward. Unable to break through the key technical resistance level at 51.60 (R1), the share closed below it after spiking up to 51.61 earlier during the day. The failure to close above the resistance might increase that levels importance going forward. When prices bounced off a significant resistance level the last time on September 28th, NCLH lost -1.17% 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 while could signal a potential change in momentum that might lead to a correction back up towards the center of the Bollinger Bands at 55.52.
The stock shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close below the lower Bollinger Band" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Norwegian Cruise. Out of 74 times, NCLH closed higher 54.05% 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 63.51% with an average market move of 2.00%.