NSC breaks above 100-day moving average for the first time since April 29th
Norfolk Southern Corporation (NSC) Technical Analysis Report for May 26, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, NSC ended Tuesday at 179.72 surging $8.25 (4.81%), notably outperforming the S&P 500 (1.23%). Today's close at 179.72 marks the highest recorded closing price since April 29th.
Daily Candlestick Chart (NSC as at May 26, 2020):
Tuesday's trading range has been $5.67 (3.2%), that's slightly above the last trading month's daily average range of $5.37. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for NSC.
One bearish candlestick pattern matches today's price action, the Bearish Hikkake Pattern.
The stock managed to close above the 100-day moving average at 176.28 for the first time since April 29th. After spiking up to 181.30 during the day, Norfolk Southern found resistance at the 200-day moving average at 179.93. The last time this happened on April 29th, NSC lost -5.12% on the following trading day.
Crossing above the upper Bollinger Band for the first time since April 29th, prices have shown unusually strong upward momentum in the short-term. This could either indicate a potential buying climax after which prices might head back down towards the mean of the Bollinger Bands at 170.54 or signal the beginning of a strong momentum breakout leading to even higher prices.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Trading close to March's high at 187.63 we could see further upside momentum if potential buy stops at the level get triggered.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Bounce off SMA 200" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Norfolk Southern. Out of 14 times, NSC closed higher 64.29% 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 64.29% with an average market move of 0.26%.