REG closes below its opening price unable to hold early session gains
Regency Centers Corporation (REG) Technical Analysis Report for Oct 12, 2018
REG ended the week -2.2% lower at 61.74 after edging higher $0.07 (0.11%) today, notably underperforming the S&P 500 (1.42%). Trading $0.63 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on Wednesday, REG lost -2.42% on the following trading day. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (REG as at Oct 12, 2018):
Friday's trading range has been $1.29 (2.08%), that's slightly above the last trading month's daily average range of $1.10. 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 REG.
Prices are trading close to the key technical support level at 61.08 (S1). Unable to break through the key technical resistance level at 62.58 (R1), the stock closed below it after spiking up to 62.71 earlier during the day. The failure to close above the resistance could increase that levels significance going forward. After having been unable to move lower than 61.61 in the previous session, the share found buyers again around the same price level today at 61.42.
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 while might signal a potential change in momentum that could lead to a correction back up towards the center of the Bollinger Bands at 63.94.
Though still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close below the lower Bollinger Band" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Regency Centers. Out of 127 times, REG closed higher 54.33% 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 58.27% with an average market move of 1.55%.