OMC finds buyers at key support level
Omnicom Group (OMC) Technical Analysis Report for Oct 12, 2018
OMC finished the week -2.29% lower at 68.60 after gaining $0.53 (0.78%) today, underperforming the S&P 500 (1.42%). Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (OMC as at Oct 12, 2018):
Friday's trading range has been $1.49 (2.17%), that's slightly below the last trading month's daily average range of $1.60. Things look different on the weekly timeframe, where the market's trading range of the last week has been way above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for OMC.
Three candlestick patterns are matching today's price action, the Homing Pigeon and the Southern Doji which are both known as bullish patterns and one neutral pattern, the Doji.
After trading down to 67.59 earlier during the day, the market bounced off the key technical support level at 68.44 (S1). The failure to close below the support might increase that levels importance as support going forward. When prices bounced off a significant support level the last time on October 5th, OMC gained 3.05% on the following trading day. Prices are trading close to the key technical resistance level at 69.88 (R1).
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
With prices trading close to this year's low at 65.85, downside momentum could accelerate should Omnicom Group break out to new lows for the year. As prices are trading close to October's low at 66.75, downside momentum might speed up should the share mark new lows for the month.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Southern Doji" stand out. Its common bullish interpretation has been confirmed for Omnicom Group. Out of 66 times, OMC closed higher 56.06% 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 59.09% with an average market move of 1.33%.