WSM closes below its opening price unable to hold early session gains
Williams-Sonoma Inc. (WSM) Technical Analysis Report for Oct 16, 2020 | by Techniquant Editorial Team
WSM ended the week 4.82% higher at 105.00 after losing $0.28 (-0.27%) today on low volume, slightly underperforming the S&P 500 (0.01%). Trading $1.26 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 Monday, WSM actually gained 6.08% on the following trading day. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (WSM as at Oct 16, 2020):
Friday's trading range has been $2.18 (2.06%), that's below the last trading month's daily average range of $2.90. 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 higher than usual for WSM.
Prices are trading close to the key technical resistance level at 107.09 (R1).
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might speed up should prices move above the close-by swing high at 107.09 where further buy stops could get triggered. Selling might accelerate should prices move below the nearby swing low at 102.28 where further sell stops could get activated.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Close near low of period" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Williams-Sonoma. Out of 530 times, WSM closed higher 52.64% 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 58.68% with an average market move of 1.33%.