WST still stuck within tight trading range
West Pharmaceutical Services Inc. (WST) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, WST finished the month 18.36% higher at 268.87 after edging lower $0.09 (-0.03%) today, underperforming the S&P 500 (0.77%). Trading $2.92 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on Tuesday, WST actually gained 2.01% on the following trading day. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (WST as at Jul 31, 2020):
Friday's trading range has been $6.14 (2.27%), that's slightly below the last trading month's daily average range of $6.42. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for WST. Prices continued to consolidate within a tight trading range between 263.71 and 273.27 where it has been caught now for the whole last trading week.
Two candlestick patterns are matching today's price action, the Bearish Hikkake Pattern and the Bearish Spinning Top which are both known as bearish patterns.
Prices are trading close to the key technical resistance level at 270.14 (R1). After having been unable to move lower than 266.32 in the previous session, West Pharmaceutical found buyers again around the same price level today at 267.13.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Selling might accelerate should prices move below the nearby swing low at 263.71 where further sell stops could get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Spinning Top" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for West Pharmaceutical. Out of 218 times, WST closed higher 58.26% 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 63.76% with an average market move of 1.58%.