QBE.AX closes within previous day's range
QBE Insurance Group Ltd (QBE.AX) Technical Analysis Report for Dec 07, 2018 | by Techniquant Editorial Team
QBE.AX ended the week -5.57% lower at 10.69 after losing $0.15 (-1.38%) today, strongly underperforming the ASX 50 (0.61%). Today's close at 10.69 marks the lowest recorded closing price since August 15th. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (QBE.AX as at Dec 07, 2018):
Friday's trading range has been $0.38 (3.47%), that's far above the last trading month's daily average range of $0.23. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for QBE.AX.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar. The last time this happened on June 13th, QBE.AX lost -0.11% on the following trading day. Additionally, two candlestick patterns are matching today's price action, the Last Engulfing Bottom Pattern which is known as bullish pattern and one bearish pattern, the Black Candle.
Prices are trading close to the key technical support level at 10.51 (S1). Prices broke below the key technical support level at 10.72 (now R1), which is likely to act as resistance going forward.
With another close below the lower Bollinger Band, prices are confirming their strong downward momentum in the short-term. A rally back into the Bollinger Band on the next trading day though might signal a potential change in momentum that could lead to a correction back up towards the center of the Bollinger Bands at 11.32.
While still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Outside Bar" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for QBE Insurance. Out of 101 times, QBE.AX closed higher 54.46% 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 nine trading days, showing a win rate of 51.49% with an average market move of 0.16%.