BRZU finds buyers again around 38.51
Direxion Daily Brazil Bull 3X Shares (BRZU) Technical Analysis Report for Jul 12, 2019 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, BRZU finished the week 6.89% higher at 38.81 after losing $0.72 (-1.82%) today. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (BRZU as at Jul 12, 2019):
Friday's trading range has been $1.78 (4.45%), that's slightly above the last trading month's daily average range of $1.75. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for BRZU.
Regardless of a strong opening Direxion Daily 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.
Prices are trading close to the key technical support level at 38.35 (S1). After having been unable to move lower than 38.76 in the previous session, the ETF found buyers again around the same price level today at 38.51. The last time this happened on Tuesday, BRZU gained 5.26% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
With prices trading close to this year's high at 41.57, upside momentum might speed up should the market be able to break out to new highs for the year.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Black Candle" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Direxion Daily. Out of 420 times, BRZU closed higher 54.29% 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 nine trading days, showing a win rate of 50.24% with an average market move of 0.94%.