SVT.L closes within prior day's range after lackluster session
Severn Trent (SVT.L) Technical Analysis Report for Dec 07, 2018 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, SVT.L ended the week 1.69% higher at 1861.00 after gaining £7.50 (0.4%) today on high volume, underperforming the FTSE 100 (1.1%). The bulls were in full control today, moving the market higher throughout the whole session. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (SVT.L as at Dec 07, 2018):
Friday's trading range has been £25.50 (1.38%), that's below the last trading month's daily average range of £52.60. 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 SVT.L.
Two candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns.
Prices are trading close to the key technical support level at 1841.00 (S1). Prices are trading close to the key technical resistance level at 1871.50 (R1). The stock ran into sellers again today around 1867.50 for the third trading day in a row after having found sellers at 1872.00 in the prior session and at 1868.50 two days ago. The last time this happened on November 6th, SVT.L actually gained 1.46% on the following trading day.
The share shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying could speed up should prices move above the close-by swing high at 1872.00 where further buy stops might get triggered. Further selling could move prices lower should the market test November's nearby low at 1786.00.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous two Highs" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Severn Trent. Out of 136 times, SVT.L closed higher 55.15% 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 57.35% with an average market move of 0.78%.