STO.AX closes within prior day's range after lackluster session
Santos Ltd (STO.AX) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
STO.AX finished the week 5.23% higher at 5.84 after edging lower $0.01 (-0.17%) today, but still slightly outperforming the ASX 50 (-0.34%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (STO.AX as at Jan 11, 2019):
Friday's trading range has been $0.07 (1.2%), that's far below the last trading month's daily average range of $0.14. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for STO.AX.
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, two candlestick patterns are matching today's price action, the Northern Doji which is known as bearish pattern and one neutral pattern, the Doji.
Prices are trading close to the key technical support level at 5.81 (S1). After having been unable to move lower than 5.80 in the prior session, the share found buyers again around the same price level today at 5.82. The last time this happened on Tuesday, STO.AX gained 1.40% on the following trading day.
While 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.
Buying could accelerate should prices move above the close-by swing high at 5.96 where further buy stops might get activated. Further buying could move prices higher should the market test December's nearby high at 6.01.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Doji" stand out. Though it is usually interpreted as neutral, it has actually shown to be bullish for Santos Ltd. Out of 147 times, STO.AX closed higher 55.10% 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 51.02% with an average market move of -0.04%.