STM.DE closes lower for the 2nd day in a row
Stabilus (STM.DE) Technical Analysis Report for Nov 09, 2018 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, STM.DE finished the week -4.54% lower at 63.05 after losing €2.15 (-3.3%) today on high volume, significantly underperforming the SDAX (-0.47%). The bears were in full control today, moving the market lower throughout the whole session. Closing below Thursday's low at 64.95, Stabilus confirmed its breakout through the previous session low after trading up to €2.10 below it intraday.
Daily Candlestick Chart (STM.DE as at Nov 09, 2018):
Friday's trading range has been €2.45 (3.77%), that's slightly below the last trading month's daily average range of €2.74. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for STM.DE.
One bearish candlestick pattern matches today's price action, the Black Candle.
Prices broke below the key technical support level at 64.10 (now R1), which is likely to act as resistance going forward. The last time this happened on Tuesday, STM.DE actually gained 2.43% on the following trading day.
Though the market is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Down Close Near Low of Period" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Stabilus. Out of 110 times, STM.DE closed higher 58.18% 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 63.64% with an average market move of 1.78%.