RXN finds buyers around 30.33 for the third day in a row
Rexnord Corporation (RXN) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
RXN finished Wednesday at 30.46 gaining $0.11 (0.36%), outperforming the S&P 500 (-0.46%). Trading $0.50 higher after the open, the stock was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (RXN as at Sep 16, 2020):
Wednesday's trading range has been $0.71 (2.32%), that's slightly below the last trading month's daily average range of $0.78. 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 RXN. Prices continued to consolidate within a tight trading range between 30.20 and 31.04 where it has been caught now for the last three trading days.
Two candlestick patterns are matching today's price action, the Bearish Spinning Top and the Shooting Star which are both known as bearish patterns. The last time a Shooting Star showed up on June 3rd, RXN actually gained 0.79% on the following trading day.
Unable to break through the key technical resistance level at 30.66 (R1), the market closed below it after spiking up to 31.04 earlier during the day. The failure to close above the resistance might increase that levels significance going forward. Rexnord found buyers again today around 30.33 for the third trading day in a row after having found demand at 30.20 in the prior session and at 30.22 two days ago.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Selling could speed up should prices move below the nearby swing low at 30.20 where further sell stops might get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Shooting Star" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Rexnord. Out of 46 times, RXN closed higher 58.70% 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 58.70% with an average market move of 0.30%.