OMC closes below its opening price unable to hold early session gains
Omnicom Group Inc. (OMC) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, OMC ended the week 1.73% higher at 51.78 after edging lower $0.08 (-0.15%) today, slightly underperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Trading $0.80 higher after the open, Omnicom Group 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 (OMC as at May 22, 2020):
Friday's trading range has been $1.47 (2.83%), that's below the last trading month's daily average range of $2.15. 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 OMC.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top. The last time a Bearish Spinning Top showed up on Monday, OMC lost -1.66% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying could accelerate should prices move above the close-by swing high at 53.50 where further buy stops might get triggered. With prices trading close to this year's low at 46.37, downside momentum could speed up should the share break out to new lows for the year.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Spinning Top" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Omnicom Group. Out of 210 times, OMC closed higher 55.24% 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 five trading days, showing a win rate of 51.43% with an average market move of 0.23%.