NOC closes above its opening price after recovering from early selling pressure
Northrop Grumman Corp. (NOC) Technical Analysis Report for Oct 12, 2018
NOC finished the week -5.61% lower at 302.37 after gaining $4.75 (1.6%) today, slightly outperforming the S&P 500 (1.42%). Trading up to $5.91 lower after the open, the share 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 (NOC as at Oct 12, 2018):
Friday's trading range has been $7.90 (2.63%), that's above the last trading month's daily average range of $5.75. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for NOC.
One bullish candlestick pattern matches today's price action, the Takuri Line.
After trading down to 294.96 earlier during the day, the market bounced off the key technical support level at 296.66 (S2). The failure to close below the support might increase that levels significance as support going forward.
Crossing above the lower Bollinger Band, prices have lost at least some of their downward momentum in the short-term and could now be heading back up towards the mean of the Bollinger Bands at 312.69. The last time this happened on July 27th, NOC actually lost -2.26% on the following trading day.
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 eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Takuri Line" stand out. Its common bullish interpretation has been confirmed for Northrop Grumman. Out of 55 times, NOC closed higher 60.00% 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 65.45% with an average market move of 0.61%.