RY finds support at 20-day moving average
Royal Bank Of Canada (RY) Technical Analysis Report for Feb 07, 2020 | by Techniquant Editorial Team
RY finished the week 2.14% higher at 80.65 after losing $0.27 (-0.33%) today, but still slightly outperforming the S&P 500 (-0.54%). 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 (RY as at Feb 07, 2020):
Friday's trading range has been $0.45 (0.56%), that's below the last trading month's daily average range of $0.63. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for RY. Prices continued to consolidate within a tight trading range between 80.24 and 80.95 where it has been caught now for the last three trading days.
After trading as low as 80.37 during the day, the market found support at the 20-day moving average at 80.48. The last time this happened on January 3rd, RY gained 0.21% on the following trading day. Prices are trading close to the key technical resistance level at 80.95 (R1).
Royal Bank shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
Buying could speed up should prices move above the nearby swing high at 80.95 where further buy stops might get activated. With prices trading close to this year's high at 82.08, upside momentum could accelerate should the share be able to break out to new highs for the year.
Among the two market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. While it is usually interpreted as neutral, it has actually shown to be bullish for Royal Bank. Out of 759 times, RY closed higher 52.44% 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 55.47% with an average market move of 0.10%.