DBC closes above its opening price after recovering from early selling pressure
PowerShares DB Commodity Tracking ETF (DBC) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, DBC finished the week 3.13% higher at 11.55 after losing $0.09 (-0.77%) today ahead of tomorrow's Memorial Day market holiday. Trading up to $0.09 lower after the open, the ETF managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on Wednesday, DBC actually lost -0.43% on the following trading day. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (DBC as at May 22, 2020):
Friday's trading range has been $0.16 (1.39%), that's slightly below the last trading month's daily average range of $0.16. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for DBC.
Though the market is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could speed up should prices move above the close-by swing high at 11.74 where further buy stops might get triggered. Further buying could move prices higher should the market test April's nearby high at 11.84.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. Its common bearish interpretation has been confirmed for DBC. Out of 298 times, DBC closed lower 50.67% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 48.99% with an average market move of -0.29%.