WLK closes within prior day's range after lackluster session
Westlake Chemical Corporation (WLK) Technical Analysis Report for Jul 13, 2020 | by Techniquant Editorial Team
WLK finished Monday at 52.14 losing $0.50 (-0.95%), slightly underperforming the S&P 500 (-0.94%). The bears were in full control today, moving the market lower throughout the whole session. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (WLK as at Jul 13, 2020):
Monday's trading range has been $1.38 (2.58%), that's below the last trading month's daily average range of $2.05. 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 WLK.
Three candlestick patterns are matching today's price action, the Bearish Hikkake Pattern, the Bearish Short Candle and the Black Candle which are known as bearish patterns. The last time a Black Candle showed up on July 9th, WLK actually gained 3.05% on the following trading day.
Prices are trading close to the key technical resistance level at 53.10 (R1).
The stock shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Selling could speed up should prices move below the nearby swing low at 50.38 where further sell stops might get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Short Candle" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Westlake Chemical. Out of 78 times, WLK closed higher 56.41% 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 57.69% with an average market move of 2.18%.