XRX closes below its opening price unable to hold early session gains
Xerox Corporation (XRX) Technical Analysis Report for Jul 24, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, XRX ended the week -9.8% lower at 15.65 after tanking $1.16 (-6.9%) today, strongly underperforming the S&P 500 (-0.62%). This is the biggest single-day loss in over a month. Trading $0.47 higher after the open, the stock was unable to hold its gains as the bears took control ending the day below its opening price. Ending with a weak close near the low of the day sets a bearish note for the next session.
Daily Candlestick Chart (XRX as at Jul 24, 2020):
Friday's trading range has been $1.09 (6.73%), that's far above the last trading month's daily average range of $0.70. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for XRX.
One bearish candlestick pattern matches today's price action, the Black Candle.
The share closed back below the 50-day moving average at 16.60 for the first time since July 14th. When this moving average was crossed below the last time on June 11th, XRX actually gained 6.23% on the following trading day.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Selling might accelerate should prices move below the close-by swing low at 15.46 where further sell stops could get triggered. With prices trading close to this year's low at 14.22, downside momentum might speed up should the market break out to new lows for the year. As prices are trading close to July's low at 14.51, downside momentum could accelerate should Xerox mark new lows for the month.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Break through SMA 50" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Xerox. Out of 97 times, XRX closed higher 57.73% 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 two trading days, showing a win rate of 59.79% with an average market move of 0.13%.