ITB still stuck within tight trading range
iShares U.S. Home Construction (ITB) Technical Analysis Report for Jul 10, 2020 | by Techniquant Editorial Team
ITB finished the week 4.31% higher at 45.21 after gaining $0.72 (1.62%) today on low volume. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (ITB as at Jul 10, 2020):
Friday's trading range has been $1.06 (2.38%), that's below the last trading month's daily average range of $1.47. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for ITB. Prices continued to consolidate within a tight trading range between 43.83 and 46.03 where it has been caught now for the whole last trading week.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, one bullish candlestick pattern matches today's price action, the White Candle. The last time a White Candle showed up on Wednesday, ITB actually lost -2.80% on the following trading day.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying might accelerate should prices move above the nearby swing high at 46.03 where further buy stops could get triggered. Selling might speed up should prices move below the close-by swing low at 44.16 where further sell stops could get activated. Further buying might move prices higher should the market test June's nearby high at 47.36.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "White Candle" stand out. Its common bullish interpretation has been confirmed for iShares U. S.. Out of 621 times, ITB closed higher 51.21% 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 56.36% with an average market move of 0.55%.