TSCO breaks below key technical support level
Tractor Supply Company (TSCO) Technical Analysis Report for Aug 15, 2019 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, TSCO finished Thursday at 99.36 losing $0.48 (-0.48%), underperforming the S&P 500 (0.25%). Today's close at 99.36 marks the lowest recorded closing price since May 29th. Trading $0.79 higher after the open, the share was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on August 9th, TSCO lost -4.70% on the following trading day. Closing below Wednesday's low at 99.76, the market confirmed its breakout through the previous session low after trading up to $1.16 below it intraday.
Daily Candlestick Chart (TSCO as at Aug 15, 2019):
Thursday's trading range has been $2.18 (2.18%), that's below the last trading month's daily average range of $3.08. Things look different on the weekly timeframe, where the market's trading range of the last week has been way above the market's average weekly trading range. The longer-term, monthly volatility is currently notably higher than usual for TSCO.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
Prices broke below the key technical support level at 99.56 (now R1), which is likely to act as resistance going forward.
With another close below the lower Bollinger Band, prices are confirming their strong downward momentum in the short-term. A rally back into the Bollinger Band on the next trading day while could signal a potential change in momentum that might lead to a correction back up towards the center of the Bollinger Bands at 107.54.
Though still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Spinning Top" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Tractor Supply. Out of 231 times, TSCO closed higher 55.84% 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 56.71% with an average market move of 1.10%.