TROW closes above its opening price after recovering from early selling pressure
T. Rowe Price Group Inc. (TROW) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
TROW ended the week 1.39% higher at 115.09 after edging higher $0.44 (0.38%) today, slightly outperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Trading up to $1.66 lower after the open, T. Rowe managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on Monday, TROW actually lost -2.58% on the following trading day. 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 (TROW as at May 22, 2020):
Friday's trading range has been $2.15 (1.87%), that's below the last trading month's daily average range of $3.65. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for TROW. Prices continued to consolidate within a tight trading range between 113.40 and 116.49 where it has been caught now for the last three trading days.
Three candlestick patterns are matching today's price action, the Hanging Man and the Northern Doji which are both known as bearish patterns and one neutral pattern, the Doji.
After trading down to 113.40 earlier during the day, the stock bounced off the key technical support level at 113.73 (S1). The failure to close below the support could increase that levels significance as support going forward. After having been unable to move lower than 113.76 in the prior session, the market found buyers again around the same price level today at 113.40.
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying might accelerate should prices move above the nearby swing high at 118.46 where further buy stops could get triggered. Further buying might move prices higher should the market test April's close-by high at 119.50.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Northern Doji" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for T. Rowe. Out of 90 times, TROW closed higher 57.78% 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 55.56% with an average market move of 0.26%.