NSC runs into sellers around 177.73 for the third day in a row
Norfolk Southern Corporation (NSC) Technical Analysis Report for Jul 02, 2020 | by Techniquant Editorial Team
NSC finished Thursday at 174.51 gaining $2.99 (1.74%) on low volume, notably outperforming the S&P 500 (0.45%) ahead of tomorrow's Independence Day OBS market holiday. Trading $1.68 higher after the open, the stock 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 in a lackluster session.
Daily Candlestick Chart (NSC as at Jul 02, 2020):
Thursday's trading range has been $4.40 (2.5%), that's below the last trading month's daily average range of $5.71. 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. Prices continued to consolidate within a tight trading range between 170.79 and 177.73 where it has been caught now for the last three trading days.
After spiking up to 177.73 during the day, the share found resistance at the 20-day moving average at 177.38. The market ran into sellers again today around 177.73 for the third trading day in a row after having found sellers at 177.63 in the prior session and at 176.93 two days ago. The last time this happened on May 7th, NSC actually gained 3.05% on the following trading day.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Selling might speed up should prices move below the nearby swing low at 170.79 where further sell 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 "Bearish Bounce off SMA 20" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Norfolk Southern. Out of 48 times, NSC closed higher 56.25% 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 75.00% with an average market move of 2.21%.