NI closes above its opening price after recovering from early selling pressure
NiSource Inc (NI) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, NI finished the month 7.52% higher at 24.45 after edging lower $0.04 (-0.16%) today, underperforming the S&P 500 (0.77%). Trading up to $0.40 lower after the open, the stock managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (NI as at Jul 31, 2020):
Friday's trading range has been $0.53 (2.17%), that's slightly below the last trading month's daily average range of $0.59. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for NI.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bullish Outside Bar. Additionally, one neutral candlestick pattern matches today's price action, the Doji. The last time a Doji showed up on Wednesday, NI lost -1.09% on the following trading day.
After trading down to 24.04 earlier during the day, the market bounced off the key technical support level at 24.26 (S1). The failure to close below the support might increase that levels significance as support going forward. After having been unable to move lower than 24.08 in the prior session, the share found buyers again around the same price level today at 24.04.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying could speed up should prices move above the close-by swing high at 24.82 where further buy stops might get activated.
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. While it is usually interpreted as bearish, it has actually shown to be bullish for NiSource. Out of 277 times, NI closed higher 56.68% 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 66.06% with an average market move of 1.04%.