NWL runs into sellers around 12.98 for the forth day in a row
Newell Brands Inc. (NWL) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
NWL finished the week 9.23% higher at 12.78 after losing $0.08 (-0.62%) today on low volume, underperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (NWL as at May 22, 2020):
Friday's trading range has been $0.32 (2.47%), that's far below the last trading month's daily average range of $0.54. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for NWL. Prices continued to consolidate within a tight trading range between 12.24 and 12.98 where it has been caught now for the whole last trading week.
Two candlestick patterns are matching today's price action, the Bearish Short Candle and the Black Candle which are both known as bearish patterns. The last time a Bearish Short Candle showed up on April 30th, NWL lost -11.53% on the following trading day.
The market was sold again around 12.98 after having seen highs at 12.92, 12.95 and 12.97 in the last three trading sessions. Obviously there is something going on at that level.
Although 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 12.36 where further sell stops could get triggered. As prices are trading close to May's high at 13.31, upside momentum might accelerate should the stock mark new highs for the month.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to prior three Highs" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Newell Brands. Out of 21 times, NWL closed higher 57.14% 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 61.90% with an average market move of 1.35%.