ROK unable to break through key resistance level
Rockwell Automation Inc. (ROK) Technical Analysis Report for Jul 01, 2020 | by Techniquant Editorial Team
ROK ended Wednesday at 210.50 losing $2.50 (-1.17%), strongly underperforming the S&P 500 (0.5%). 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 (ROK as at Jul 01, 2020):
Wednesday's trading range has been $4.27 (2.01%), that's below the last trading month's daily average range of $5.95. 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.
After moving higher in the prior session, the stock closed lower but above the previous day's open today, forming a bearish Harami Candle. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle. The last time a Black Candle showed up on June 23rd, ROK lost -1.75% on the following trading day.
Unable to break through the key technical resistance level at 213.24 (R1), the market closed below it after spiking up to 213.69 earlier during the day. The failure to close above the resistance might increase that levels significance going forward. After having been unable to move lower than 208.89 in the prior session, Rockwell Automation found buyers again around the same price level today at 209.42.
Though the share is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Further selling might move prices lower should the market test June's nearby low at 200.60.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Black Candle" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Rockwell Automation. Out of 512 times, ROK closed higher 50.98% 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 60.55% with an average market move of 1.07%.