SHW climbs to highest close ever
Sherwin-Williams Company (SHW) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
SHW finished the month 12.13% higher at 647.92 after edging higher $0.29 (0.04%) today, underperforming the S&P 500 (0.77%). Today's close at 647.92 marks the highest recorded closing price ever. Trading up to $5.83 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (SHW as at Jul 31, 2020):
Friday's trading range has been $9.25 (1.43%), that's below the last trading month's daily average range of $13.17. 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 SHW. Prices continued to consolidate within a tight trading range between 634.52 and 650.98 where it has been caught now for the last three trading days.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Hanging Man. The last time a Hanging Man showed up on July 21st, SHW actually gained 2.04% on the following trading day.
Sherwin-Williams ran into sellers again today around 649.50 for the third trading day in a row after having found sellers at 650.19 in the prior session and at 650.98 two days ago.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might accelerate should prices move above the close-by swing high at 659.87 where further buy stops could get triggered.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Hanging Man" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Sherwin-Williams. Out of 82 times, SHW closed higher 54.88% 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 63.41% with an average market move of 0.90%.