DBC pops to highest close since September 18th
PowerShares DB Commodity Tracking ETF (DBC) Technical Analysis Report for Oct 15, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, DBC ended Thursday at 13.36 gaining $0.04 (0.3%). Today's close at 13.36 marks the highest recorded closing price since September 18th. The bulls were in full control today, moving the market higher throughout the whole session. Closing above Wednesday's high at 13.34, the ETF confirmed its breakout through the prior session high after trading up to $0.02 above it intraday.
Daily Candlestick Chart (DBC as at Oct 15, 2020):
Thursday's trading range has been $0.25 (1.9%), that's far above the last trading month's daily average range of $0.16. Things look different on the weekly timeframe, where the market's trading range of the last week has been way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for DBC.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bullish Outside Bar. Additionally, three candlestick patterns are matching today's price action, the Bullish Closing Marubozu and the White Candle which are both known as bullish patterns and one bearish pattern, the Last Engulfing Top Pattern. The last time a Bullish Closing Marubozu showed up on May 4th, DBC gained 2.57% on the following trading day.
Prices are trading close to the key technical support level at 13.28 (S1). After having been unable to move above 13.34 in the previous session, the market ran into sellers again around the same price level today, missing to move higher than 13.36.
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 nearby swing high at 13.42 where further buy stops could get triggered.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Last Engulfing Top Pattern" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for DBC. Out of 63 times, DBC closed higher 49.21% 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 58.73% with an average market move of 0.46%.