NOC finds buyers at key support level
Northrop Grumman Corporation (NOC) Technical Analysis Report for Jul 12, 2019 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, NOC finished the week 1.33% higher at 329.53 after surging $4.60 (1.42%) today, outperforming the S&P 500 (0.46%). Today's close at 329.53 marks the highest recorded closing price since June 11, 2018. Trading up to $3.02 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. Closing above Thursday's high at 328.26, the stock confirmed its breakout through the prior session high after trading up to $1.35 above it intraday.
Daily Candlestick Chart (NOC as at Jul 12, 2019):
Friday's trading range has been $6.35 (1.95%), that's far above the last trading month's daily average range of $4.68. Things look different on the weekly timeframe, where the market's trading range of the last week has been below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for NOC.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bullish Outside Bar. Additionally, one bullish candlestick pattern matches today's price action, the White Candle.
After trading down to 323.26 earlier during the day, Northrop Grumman bounced off the key technical support level at 323.73 (S1). The failure to close below the support might increase that levels importance as support going forward. The share found buyers again today around 323.26 for the third trading day in a row after having found demand at 324.02 in the previous session and at 323.85 two days ago. The last time this happened on April 22nd, NOC gained 3.44% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Higher Closes" stand out. Its common bullish interpretation has been confirmed for Northrop Grumman. Out of 326 times, NOC closed higher 56.75% 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 65.95% with an average market move of 0.97%.