WU dominated by bears dragging the market lower throughout the day
Western Union Company (WU) Technical Analysis Report for Jul 02, 2020 | by Techniquant Editorial Team
WU ended Thursday at 21.55 losing $0.14 (-0.65%) on low volume, notably underperforming the S&P 500 (0.45%) ahead of tomorrow's Independence Day OBS market holiday. The bears were in full control today, moving the market lower throughout the whole session. Closing below Wednesday's low at 21.69, the stock confirmed its breakout through the previous session low after trading up to $0.20 below it intraday.
Daily Candlestick Chart (WU as at Jul 02, 2020):
Thursday's trading range has been $0.51 (2.33%), that's slightly below the last trading month's daily average range of $0.61. 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 WU.
Even with a strong opening Western Union closed below the prior day's open and close, forming a bearish Engulfing Candle. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle. The last time a Black Candle showed up on June 24th, WU actually gained 1.05% on the following trading day.
Prices are trading close to the key technical support level at 21.33 (S1).
The share shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying might accelerate should prices move above the close-by swing high at 22.26 where further buy stops could get triggered. Selling might speed up should prices move below the nearby swing low at 21.16 where further sell stops could get activated.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Engulfing Candle" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Western Union. Out of 77 times, WU closed higher 54.55% 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 64.94% with an average market move of 1.34%.