JNUG unable to break through key resistance level
Direxion Junior Gold Miners Index 3x Shares (JNUG) Technical Analysis Report for Feb 20, 2020 | by Techniquant Editorial Team
JNUG ended Thursday at 88.36 losing $1.93 (-2.14%) on high volume. Trading up to $2.72 lower after the open, JNUG ETF managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (JNUG as at Feb 20, 2020):
Thursday's trading range has been $6.88 (7.8%), that's far above the last trading month's daily average range of $4.91. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for JNUG.
Five candlestick patterns are matching today's price action, the Gravestone Doji and the Northern Doji which are both known as bearish patterns and three neutral patterns, the Doji, the Long-Legged Doji and the Rickshaw-Man. The last time a Rickshaw-Man showed up on October 18, 2019, JNUG lost -7.02% on the following trading day.
Unable to break through the key technical resistance level at 89.00 (R1), the ETF closed below it after spiking up to 92.42 earlier during the day. The failure to close above the resistance could increase that levels importance going forward.
With another close above the upper Bollinger Band, prices are confirming their strong upward momentum in the short-term. A drop back into the Bollinger Band on the next trading day though might signal a potential change in momentum that could lead to a correction back down towards the center of the Bollinger Bands at 75.34.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close above the upper Bollinger Band" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for JNUG ETF. Out of 95 times, JNUG closed lower 63.16% 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 62.11% with an average market move of -3.67%.