JNUG rises to highest close since August 17th
Direxion Junior Gold Miners Index 3x Shares (JNUG) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, JNUG ended Wednesday at 162.33 gaining $2.00 (1.25%) on low volume. Today's close at 162.33 marks the highest recorded closing price since August 17th. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (JNUG as at Sep 16, 2020):
Wednesday's trading range has been $7.01 (4.2%), that's far below the last trading month's daily average range of $10.96. 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 JNUG.
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, two candlestick patterns are matching today's price action, the Bearish Short Candle and the Black Candle which are both known as bearish patterns.
After trading down to 160.39 earlier during the day, the ETF bounced off the key technical support level at 161.97 (S1). The failure to close below the support could increase that levels importance as support going forward. After having been unable to move above 167.50 in the previous session, JNUG ETF ran into sellers again around the same price level today, failing to move higher than 167.40. The last time this happened on September 8th, JNUG actually gained 8.47% on the following trading day.
Crossing above the upper Bollinger Band for the first time since July 27th, prices have shown unusually strong upward momentum in the short-term. This might either indicate a potential buying climax after which prices could head back down towards the mean of the Bollinger Bands at 148.85 or signal the beginning of a strong momentum breakout leading to even higher prices.
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 close-by swing high at 167.50 where further buy stops could get activated.
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. Although it is usually interpreted as bullish, it has actually shown to be bearish for JNUG ETF. Out of 109 times, JNUG closed lower 61.47% 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 62.39% with an average market move of -3.86%.