WES.AX closes within prior day's range
Wesfarmers Ltd (WES.AX) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, WES.AX ended the week -0.41% lower at 31.95 after edging lower $0.02 (-0.06%) today, but still slightly outperforming the ASX 50 (-0.34%). Trading $0.40 higher after the open, the stock was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on January 3rd, WES.AX actually gained 1.04% on the following trading day. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (WES.AX as at Jan 11, 2019):
Friday's trading range has been $0.61 (1.9%), that's slightly below the last trading month's daily average range of $0.67. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for WES.AX.
One bullish candlestick pattern matches today's price action, the Last Engulfing Bottom Pattern.
Unable to break through the key technical resistance level at 32.20 (R1), the share closed below it after spiking up to 32.55 earlier during the day. The failure to close above the resistance might increase that levels significance going forward.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Selling could accelerate should prices move below the nearby swing low at 31.71 where further sell stops might get triggered. 2018's low at 30.40 is within reach and we could see further downside momentum should Wesfarmers Ltd break out beyond. Further buying might move prices higher should the market test December's close-by high at 33.06.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Last Engulfing Bottom Pattern" stand out. Its common bullish interpretation has been confirmed for Wesfarmers Ltd. Out of 53 times, WES.AX closed higher 58.49% 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 50.94% with an average market move of -0.08%.