NGVT unable to break through key resistance level
Ingevity Corporation (NGVT) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
NGVT finished the month 11.24% higher at 58.48 after surging $2.45 (4.37%) today on high volume, strongly outperforming the S&P 500 (0.77%). Closing above Thursday's high at 57.63, the market confirmed its breakout through the prior session high after trading up to $2.36 above it intraday.
Daily Candlestick Chart (NGVT as at Jul 31, 2020):
Friday's trading range has been $2.99 (5.2%), that's far above the last trading month's daily average range of $1.87. Weekly volatility is also higher, being above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for NGVT.
The share managed to close back above the 20-day moving average at 56.71. When this moving average was crossed above the last time on July 2nd, NGVT gained 1.06% on the following trading day. Unable to break through the key technical resistance level at 59.80 (R1), the stock closed below it after spiking up to 59.99 earlier during the day. The failure to close above the resistance could increase that levels importance going forward.
Although Ingevity 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 60.36 where further buy stops might get triggered. As prices are trading close to July's high at 60.69, upside momentum could speed up should NGVT mark new highs for the month.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. While it is usually interpreted as neutral, it has actually shown to be bullish for Ingevity. Out of 304 times, NGVT closed higher 56.25% 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 56.91% with an average market move of 1.52%.