Fri 15'th Jun 2018
Explanation to Bollinger's Bands
Bollinger Bands was created by John Bollinger in the early 1980s, which purpose is to provide a relative definition of high and low. This defintion is used to identify buy and sell signals and have proven very well in doing so.
Bollinger Bands consist of a set of three curves drawn in relation to securities prices. The middle band is a measure of the intermediate-term trend, usually a simple moving average, that serves as the base for the upper and lower bands. The interval between the upper and lower bands and the middle band is determined by volatility, typically the standard deviation of the same data that were used for the average. Get-A-Graph uses Bollingers suggested 20 day average.
Middle Bollinger Band = 20-period simple moving average
Upper Bollinger Band = Middle Bollinger Band + 2 * 20-period standard deviation
Lower Bollinger Band = Middle Bollinger Band - 2 * 20-period standard deviation
BandWidth defines the current width of the band.
%b defines the current position within the band.
BandWidth = (Upper Bollinger Band - Lower Bollinger Band) / Middle Bollinger Band
%b = (Last - Lower Bollinger Band) / (Upper Bollinger Band - Lower Bollinger Band)
Bottlenecks in bandwidth indicates a upcoming change. Break up through the moving average line, or continuously movements above the moving average line indicates a break up, and vice versa downwards.
State Auto Financial Corporation Stock Analysis
Technical stock analysis for Fri 15'th Jun 2018
State Auto Financial Corporation gained 3.92% in the last trading day, rising from $31.99 to $33.24 , and has now gained 4 days in a row. It will be exciting to see whether it manages to continue gaining or take a minor break for the next few days. The price has risen in 7 of the last 10 days and is up by 4.89% over the past 2 weeks. Volume has increased in the last day along with the price, which is a positive technical sign, and, in total, 67 649 more shares were traded than the day before. In total, 93 616 shares bought and sold for approximately $0.00.
|Shorts||19.68% ( 2018-05-31 )|
State Auto Financial Corporation has broken the strong rising the short-term trend up and an even stronger rising rate is indicated. For any reaction back there will now be support on the roof on the current trend broken at $32.97, a level that may pose a second chance to hit a runner. According to fan-theory $35.79 will be the next possible trend-top level and thereby pose a resistance level which may not be broken at the first attempt.
Only positive signals in the chart today. State Auto Financial Corporation holds buy signals from both short- and long-term moving averages. In addition, there is a general buy signal from the relation between the two signals where the short-term average is above the long-term average. On corrections down there will be some support from the lines at $32.16 and $30.88. A break down below any of these levels will issue sell signals. A buy signal was issued from a pivot bottom point on Tuesday June 12, 2018, which indicates further gains until a new top pivot has been found. Volume is rising along with the price. This is considered to be a good technical signal.
Relative Strength Index (RSI)
The stock holds a RSI14 at 77 and is currently being overbought on RSI. This does not have to be a sales signal as many stocks may go both long and hard while being overbought on the RSI. It is therefore important to evaluate the history of the share as it may tell you something about the RSI-sensitiveness.
Support & Resistance
On the downside, the stock finds support just below today's level from accumulated volume at $31.23 and $28.57.
There is natural risk involved when a stock is testing a support level, since if this is broken, the stock then may fall to the next support level. In this case, State Auto Financial Corporation finds support just below today's level at $31.23. If this is broken, then the next support from accumulated volume will be at $28.57 and $28.42.
This stock is usually traded at good volume, and with minor daily changes the risk is considered to be low. During the last day, the stock moved $1.70 (5.37%) between high and low. For the last week, the stock has had a daily average volatility of 3.03%.
The stock is extremely overbought on RSI14 (77). Normally this will pose a good selling opportunity, but since the stock has broken the trend up the chance for a major correction due to high RSI is very small as the stock will find support at the trend broken.
Our recommended stoploss: $31.97 (-3.82%) (This stock has medium daily movements and this gives medium risk. The RSI14 is 77 and this increases the risk substantially. There is a buy signal from pivot bottom found 3 days ago.)
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State Auto Financial Corporation holds several positive signals and has broken the strong rising trend up. As the stock is also in great technical shape, we therefore consider it to be a good choice at these current levels and we are expecting further gains during the next 3 months.
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