BA drops to lowest close since September 24th
The Boeing Company (BA) Technical Analysis Report for Oct 27, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, BA finished Tuesday at 155.24 losing $5.59 (-3.48%), notably underperforming the Dow Indu. (-0.8%) ahead of Wednesday's earnings report. Today's close at 155.24 marks the lowest recorded closing price since September 24th. The bears were in full control today, moving the market lower throughout the whole session. Closing below Monday's low at 159.05, the market confirmed its breakout through the prior session low after trading up to $4.05 below it intraday.
Daily Candlestick Chart (BA as at Oct 27, 2020):
BA is set to report earnings before tomorrow's market open. For the upcoming report, analysts expect the company to have earned $-2.24 per share. The company's last earnings report was released on July 29, 2020, when The Boeing Company reported earnings of $-4.79 per share missing market expectations by -64.0%.
Tuesday's trading range has been $5.25 (3.3%), that's slightly below the last trading month's daily average range of $5.45. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for BA.
One bearish candlestick pattern matches today's price action, the Black Candle.
Prices broke below the key technical support level at 156.32 (now R1), which is likely to act as resistance going forward.
Crossing below the lower Bollinger Band for the first time since September 24th, prices have shown unusually strong downward momentum in the short-term. This could either indicate a potential selling climax after which prices might head back up towards the mean of the Bollinger Bands at 165.35 or signal the beginning of a strong momentum breakout leading to even lower prices. The last time prices broke out below the lower Bollinger Band on September 23rd, BA lost -3.39% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Further selling could move prices lower should the market test September's nearby low at 145.02.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the Stock Earning Report based market condition "Trading Day before Earnings Report" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for The Boeing. Out of 32 times, BA closed higher 62.50% 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 59.38% with an average market move of 1.57%.