TMO closes above its opening price after recovering from early selling pressure
Thermo Fisher Scientific Inc (TMO) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
TMO finished the week -0.78% lower at 340.26 after gaining $4.51 (1.34%) today on low volume, notably outperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Trading up to $1.90 lower after the open, the stock managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (TMO as at May 22, 2020):
Friday's trading range has been $5.29 (1.57%), that's below the last trading month's daily average range of $8.58. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly lower than usual for TMO.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. After moving lower in the previous session, the share managed to close higher but below the prior day's open, forming a bullish Harami Candle. The last time this candlestick pattern showed up on April 24th, TMO gained 4.26% on the following trading day. Additionally, two candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns.
Thermo Fisher managed to close back above the 20-day moving average at 336.94. After having been unable to move lower than 334.75 in the previous session, the market found buyers again around the same price level today at 335.52.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Selling could speed up should prices move below the nearby swing low at 334.75 where further sell stops might get activated. As prices are trading close to May's low at 325.33, downside momentum could accelerate should TMO mark new lows for the month.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. While it is usually interpreted as neutral, it has actually shown to be bullish for Thermo Fisher. Out of 656 times, TMO closed higher 55.03% 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 64.02% with an average market move of 1.28%.