SNA finds buyers at key support level
Snap-On Incorporated (SNA) Technical Analysis Report for Dec 07, 2018 | by Techniquant Editorial Team
Moving lower for the 4th day in a row, SNA ended the week -9.17% lower at 151.00 after tanking $4.97 (-3.19%) today, underperforming the S&P 500 (-2.33%) following today's NFP report. Today's close at 151.00 marks the lowest recorded closing price since October 30th. The bears were in full control today, moving the market lower throughout the whole session. Closing below Thursday's low at 151.31, the share confirmed its breakout through the previous session low after trading up to $1.48 below it intraday.
Daily Candlestick Chart (SNA as at Dec 07, 2018):
Friday's trading range has been $7.67 (4.91%), that's far above the last trading month's daily average range of $3.83. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for SNA.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar. Additionally, two candlestick patterns are matching today's price action, the Last Engulfing Bottom Pattern which is known as bullish pattern and one bearish pattern, the Black Candle.
After trading down to 149.83 earlier during the day, Snap-On Incorporated bounced off the key technical support level at 150.73 (S1). The failure to close below the support might increase that levels importance as support going forward. When prices bounced off a significant support level the last time on November 27th, SNA gained 2.58% on the following trading day.
With another close below the lower Bollinger Band, prices are confirming their strong downward momentum in the short-term. A rally back into the Bollinger Band on the next trading day although could signal a potential change in momentum that might lead to a correction back up towards the center of the Bollinger Bands at 161.13.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Trading close to October's low at 145.42 we could see further downside momentum if potential sell stops at the level get triggered.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for Snap-On Incorporated. Out of 457 times, SNA closed higher 57.11% 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 61.71% with an average market move of 1.07%.