ROK closes higher for the 2nd day in a row
Rockwell Automation Inc. (ROK) Technical Analysis Report for Jul 27, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, ROK finished Monday at 229.00 gaining $2.81 (1.24%), slightly outperforming the S&P 500 (0.74%) ahead of Tuesday's earnings report. Today's close at 229.00 marks the highest recorded closing price ever. Closing above Friday's high at 227.62, Rockwell Automation confirmed its breakout through the prior session high after trading up to $3.27 above it intraday.
Daily Candlestick Chart (ROK as at Jul 27, 2020):
ROK is set to report earnings before tomorrow's market open. For the upcoming report, analysts expect the company to have earned $1.14 per share. The company's last earnings report was released on April 28, 2020, when Rockwell Automation Inc. reported earnings of $2.43 per share beating market expectations by 32.8%.
Monday's trading range has been $5.75 (2.55%), that's far above the last trading month's daily average range of $4.22. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for ROK.
Two candlestick patterns are matching today's price action, the White Candle which is known as bullish pattern and one bearish pattern, the Last Engulfing Top Pattern.
Buyers managed to take out the key technical resistance level at 228.20 (now S1), which is likely to act as support going forward. The stock was bought again around 225.14 after having seen lows at 225.12, 225.13 and 224.87 in the last three trading sessions. Obviously there is something going on at that level. The last time this happened on January 2nd, ROK actually lost -1.46% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Selling might speed up should prices move below the nearby swing low at 225.12 where further sell stops could get triggered.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to previous two Lows" stand out. Its common bullish interpretation has been confirmed for Rockwell Automation. Out of 133 times, ROK closed higher 58.65% 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 57.14% with an average market move of 0.87%.