UNP closes within prior day's range
Union Pacific Corporation (UNP) Technical Analysis Report for Oct 12, 2018 | by Techniquant Editorial Team
UNP ended the week -6.79% lower at 152.65 after gaining $0.56 (0.37%) today, notably underperforming the S&P 500 (1.42%). Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (UNP as at Oct 12, 2018):
Friday's trading range has been $3.53 (2.29%), that's above the last trading month's daily average range of $2.51. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for UNP.
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.
Prices are trading close to the key technical support level at 150.26 (S1). Prices are trading close to the key technical resistance level at 153.72 (R1).
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 although could signal a potential change in momentum that might lead to a correction back up towards the center of the Bollinger Bands at 161.64.
Though Union Pacific is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Selling might speed up should prices move below the close-by swing low at 150.36 where further sell stops could get triggered. Further selling might move prices lower should the market test September's nearby low at 149.71.
Among the four 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 Union Pacific. Out of 688 times, UNP closed higher 54.65% 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 62.06% with an average market move of 1.26%.