NWS breaks back below 20-day moving average
News Corporation (NWS) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
NWS finished Wednesday at 14.98 losing $0.25 (-1.64%) on high volume, notably underperforming the S&P 500 (-0.46%). The bears were in full control today, moving the market lower throughout the whole session. Closing below Tuesday's low at 15.13, the market confirmed its breakout through the prior session low after trading up to $0.17 below it intraday.
Daily Candlestick Chart (NWS as at Sep 16, 2020):
Wednesday's trading range has been $0.34 (2.22%), that's slightly above the last trading month's daily average range of $0.32. 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 strongly lower than usual for NWS.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bearish Outside Bar. Notwithstanding a strong opening News closed below the previous day's open and close, forming a bearish Engulfing Candle. The last time this candlestick pattern showed up on September 4th, NWS lost -2.14% on the following trading day. Additionally, two candlestick patterns are matching today's price action, the Bearish Belt-hold and the Black Candle which are both known as bearish patterns.
The share closed back below the 20-day moving average at 15.03. The stock ran into sellers again today around 15.30 for the third trading day in a row after having found sellers at 15.26 in the prior session and at 15.31 two days ago.
Although NWS is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Buying might speed up should prices move above the nearby swing high at 15.31 where further buy stops could get triggered. With prices trading close to this year's high at 15.55, upside momentum might accelerate should the market be able to break out to new highs for the year. As prices are trading close to September's high at 15.37, upside momentum could speed up should News mark new highs for the month.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Decisive Down Move" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for News. Out of 190 times, NWS closed higher 53.68% 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 52.63% with an average market move of 0.75%.