NSC breaks back below 100-day moving average
Norfolk Southern Corporation (NSC) Technical Analysis Report for Jun 26, 2020 | by Techniquant Editorial Team
NSC finished the week -0.26% lower at 169.81 after losing $1.87 (-1.09%) today on high volume, but still strongly outperforming the S&P 500 (-2.42%). Trading $1.79 higher after the open, Norfolk Southern was unable to hold its gains as the bears took control ending the day below 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 (NSC as at Jun 26, 2020):
Friday's trading range has been $5.10 (2.99%), that's slightly below the last trading month's daily average range of $5.70. 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 NSC.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top. The last time a Bearish Spinning Top showed up on April 23rd, NSC actually gained 3.09% on the following trading day.
After trading down to 167.41 earlier during the day, the market bounced off the key technical support level at 167.62 (S1). The failure to close below the support might increase that levels significance as support going forward. The stock closed back below the 100-day moving average at 170.83. After having been unable to move above 171.89 in the prior session, the share ran into sellers again around the same price level today, missing to move higher than 172.51.
NSC shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying could accelerate should prices move above the nearby swing high at 175.80 where further buy stops might get triggered. Selling could speed up should prices move below the close-by swing low at 166.00 where further sell stops might get activated.
Among the seven 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 Norfolk Southern. Out of 411 times, NSC closed higher 56.93% 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 57.91% with an average market move of 0.72%.