WAT closes within previous day's range after lackluster session
Waters Corporation (WAT) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
WAT finished the week 4.61% higher at 186.68 after gaining $1.42 (0.77%) today, outperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Trading up to $1.18 lower after the open, Waters managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on April 27th, WAT actually lost -5.59% on the following trading day. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (WAT as at May 22, 2020):
Friday's trading range has been $3.11 (1.67%), that's far below the last trading month's daily average range of $5.80. 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 WAT. Prices continued to consolidate within a tight trading range between 182.06 and 189.24 where it has been caught now for the whole last trading week.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, one bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
Prices are trading close to the key technical resistance level at 189.74 (R1). After having been unable to move above 188.63 in the prior session, the market ran into sellers again around the same price level today, failing to move higher than 188.17.
The stock shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying could speed up should prices move above the nearby swing high at 188.63 where further buy stops might get activated. Selling could accelerate should prices move below the close-by swing low at 183.64 where further sell stops might get triggered. As prices are trading close to May's high at 190.74, upside momentum could speed up should the share mark new highs for the month.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Spinning Top" stand out. Its common bullish interpretation has been confirmed for Waters. Out of 236 times, WAT closed higher 52.54% 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 62.29% with an average market move of 0.70%.