VZ finds buyers at key support level
Verizon Communications Inc. (VZ) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
VZ ended the week -2.39% lower at 58.51 after losing $0.14 (-0.24%) today, slightly underperforming the Dow Indu. (-0.09%) ahead of tomorrow's Presidents' Day market holiday. 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 (VZ as at Feb 14, 2020):
Friday's trading range has been $0.53 (0.9%), that's below the last trading month's daily average range of $0.86. Things look different on the weekly timeframe, where the market's trading range of the last week has been above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for VZ. Prices continued to consolidate within a tight trading range between 57.95 and 58.86 where it has been caught now for the last three trading days.
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 trading down to 58.28 earlier during the day, Verizon Communications bounced off the key technical support level at 58.34 (S1). The failure to close below the support could increase that levels significance as support going forward. The share ran into sellers again today around 58.81 for the third trading day in a row after having found sellers at 58.83 in the previous session and at 58.86 two days ago. The last time this happened on January 13th, VZ lost -0.19% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Selling might speed up should prices move below the nearby swing low at 57.95 where further sell stops could get activated. With prices trading close to this year's low at 57.65, downside momentum might accelerate should the market break out to new lows for the year.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for Verizon Communications. Out of 460 times, VZ closed higher 55.65% 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 53.04% with an average market move of 0.27%.