ROK pushes through Friday's high
Rockwell Automation Inc. (ROK) Technical Analysis Report for Jun 29, 2020 | by Techniquant Editorial Team
ROK finished Monday at 208.67 gaining $3.40 (1.66%) on low volume, slightly outperforming the S&P 500 (1.47%). Trading up to $2.44 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. Closing above Friday's high at 207.91, the share confirmed its breakout through the prior session high after trading up to $1.57 above it intraday.
Daily Candlestick Chart (ROK as at Jun 29, 2020):
Monday's trading range has been $4.14 (1.99%), that's below the last trading month's daily average range of $5.89. 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 ROK.
Two candlestick patterns are matching today's price action, the Hammer which is known as bullish pattern and one bearish pattern, the Bearish Hikkake Pattern. The last time a Bearish Hikkake Pattern showed up on April 22nd, ROK actually gained 1.90% on the following trading day.
While the stock is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Buying could speed up should prices move above the nearby swing high at 213.24 where further buy stops might get triggered. Selling could accelerate should prices move below the close-by swing low at 202.02 where further sell stops might get activated. As prices are trading close to June's low at 200.60, downside momentum could speed up should Rockwell Automation mark new lows for the month.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Hikkake Pattern" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Rockwell Automation. Out of 112 times, ROK closed higher 50.89% 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 60.71% with an average market move of 1.00%.