NOC closes above its opening price after recovering from early selling pressure
Northrop Grumman Corporation (NOC) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
NOC ended the week 3.29% higher at 256.05 after losing $1.61 (-0.62%) today on low volume, underperforming the S&P 500 (-0.01%). Trading up to $2.80 lower after the open, the share managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on Wednesday, NOC gained 2.19% 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 (NOC as at Jan 11, 2019):
Friday's trading range has been $3.77 (1.48%), that's far below the last trading month's daily average range of $7.29. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for NOC.
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 Hanging Man.
After trading down to 252.44 earlier during the day, the stock bounced off the key technical support level at 254.84 (S1). The failure to close below the support might increase that levels significance as support going forward.
Though Northrop Grumman is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Buying might accelerate should prices move above the close-by swing high at 257.85 where further buy stops could get activated.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for Northrop Grumman. Out of 427 times, NOC closed higher 58.55% 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 60.89% with an average market move of 0.82%.