SHW breaks back above 20-day moving average
Sherwin-Williams Company (SHW) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
SHW finished the week 2.25% higher at 585.45 after gaining $5.69 (0.98%) today on low volume, outperforming the S&P 500 (0.18%) ahead of tomorrow's Presidents' Day market holiday. The bulls were in full control today, moving the market higher throughout the whole session. Closing above Thursday's high at 582.57, Sherwin-Williams confirmed its breakout through the previous session high after trading up to $2.88 above it intraday.
Daily Candlestick Chart (SHW as at Feb 14, 2020):
Friday's trading range has been $6.28 (1.08%), that's below the last trading month's daily average range of $9.58. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for SHW.
Two candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns. The last time a Bullish Short Candle showed up on October 18, 2019, SHW actually lost -1.86% on the following trading day.
The share managed to close back above the 20-day moving average at 582.84 for the first time since February 5th. Prices are trading close to the key technical resistance level at 589.00 (R1).
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could speed up should prices move above the close-by swing high at 589.99 where further buy stops might get triggered. With prices trading close to this year's high at 599.95, upside momentum could accelerate should the market be able to break out to new highs for the year. As prices are trading close to February's high at 589.99, upside momentum might speed up should the stock mark new highs for the month.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Short Candle" stand out. Its common bullish interpretation has been confirmed for Sherwin-Williams. Out of 70 times, SHW closed higher 51.43% 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 68.57% with an average market move of 1.15%.