VMC closes above its opening price after recovering from early selling pressure
Vulcan Materials Company (VMC) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 5th day in a row, VMC ended Wednesday at 133.29 gaining $1.87 (1.42%), strongly outperforming the S&P 500 (-0.46%). Today's close at 133.29 marks the highest recorded closing price since March 4th. Trading up to $2.47 lower after the open, the share 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.
Daily Candlestick Chart (VMC as at Sep 16, 2020):
Wednesday's trading range has been $4.80 (3.63%), that's far above the last trading month's daily average range of $3.30. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for VMC.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bullish Outside Bar. The last time this happened on June 2nd, VMC gained 7.00% on the following trading day. Additionally, one bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
After having been unable to move above 134.14 in the prior session, the stock ran into sellers again around the same price level today, failing to move higher than 134.58.
With another close above the upper Bollinger Band, prices are confirming their strong upward momentum in the short-term. A drop 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 down towards the center of the Bollinger Bands at 125.15.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Further buying could move prices higher should the market test August's close-by high at 136.14.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "5 Consecutive Higher Closes" stand out. Its common bullish interpretation has been confirmed for Vulcan Materials. Out of 28 times, VMC closed higher 71.43% 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 four trading days, showing a win rate of 57.14% with an average market move of 0.79%.