FVD closes below its opening price unable to hold early session gains
First Trust VL Dividend (FVD) Technical Analysis Report for Jul 02, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, FVD finished Thursday at 30.55 gaining $0.18 (0.59%) ahead of tomorrow's Independence Day OBS market holiday. Trading $0.20 higher after the open, the ETF was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (FVD as at Jul 02, 2020):
Thursday's trading range has been $0.47 (1.53%), that's slightly below the last trading month's daily average range of $0.60. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for FVD.
The market managed to close back above the 100-day moving average at 30.39 for the first time since June 18th. After spiking up to 30.93 during the day, First Trust found resistance at the 20-day moving average at 30.93. The last time this happened on May 5th, FVD lost -1.86% on the following trading day.
FVD shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying might speed up should prices move above the nearby swing high at 31.11 where further buy stops could get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Bounce off SMA 20" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for First Trust. Out of 38 times, FVD closed higher 55.26% 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 78.95% with an average market move of 0.87%.