NEU closes lower for the 2nd day in a row
NewMarket Corp (NEU) Technical Analysis Report for Apr 16, 2019 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, NEU ended Tuesday at 428.61 edging lower $0.17 (-0.04%), slightly underperforming the S&P 500 (0.05%). Trading $1.68 higher after the open, the stock was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on April 11th, NEU actually gained 0.82% on the following trading day. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (NEU as at Apr 16, 2019):
Tuesday's trading range has been $3.60 (0.84%), that's far below the last trading month's daily average range of $7.32. 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 NEU. Prices continued to consolidate within a tight trading range between 426.62 and 435.29 where it has been caught now for the whole last trading week.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
After trading down to 427.58 earlier during the day, the market bounced off the key technical support level at 428.14 (S1). The failure to close below the support might increase that levels significance as support going forward. The share was bought again around 427.58 after having seen lows at 427.09, 427.32 and 426.62 in the last three trading sessions. Obviously there is something going on at that level.
Although NewMarket is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Buying might accelerate should prices move above the close-by swing high at 435.29 where further buy stops could get activated. Selling might speed up should prices move below the nearby swing low at 427.09 where further sell stops could get triggered. As prices are trading close to April's high at 438.12, upside momentum might accelerate should NEU mark new highs for the month. As prices are trading close to April's low at 423.48, downside momentum could speed up should the stock mark new lows for the month.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to prior three Lows" stand out. Its common bullish interpretation has been confirmed for NewMarket. Out of 26 times, NEU closed higher 53.85% 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 73.08% with an average market move of 1.27%.