PPL still stuck within tight trading range
PPL Corporation (PPL) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
PPL ended the week 4.65% higher at 25.65 after edging lower $0.05 (-0.19%) today on low volume, slightly 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 (PPL as at May 22, 2020):
Friday's trading range has been $0.32 (1.25%), that's far below the last trading month's daily average range of $0.81. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for PPL. Prices continued to consolidate within a tight trading range between 25.30 and 26.48 where it has been caught now for the whole last trading week.
Two candlestick patterns are matching today's price action, the Bearish Spinning Top and the Hanging Man which are both known as bearish patterns. The last time a Hanging Man showed up on March 30th, PPL lost -4.45% on the following trading day.
Prices are trading close to the key technical resistance level at 25.76 (R1). The share was bought again around 25.41 after having seen lows at 25.48, 25.48 and 25.34 in the last three trading sessions. Obviously there is something going on at that level.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying might accelerate should prices move above the close-by swing high at 26.03 where further buy stops could get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Hanging Man" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for PPL. Out of 78 times, PPL closed higher 64.10% 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 60.26% with an average market move of 0.43%.