SDOW slips to lowest close since March 4th
UltraPro Short Dow30 (SDOW) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, SDOW finished Thursday at 45.42 losing $10.40 (-18.63%) on high volume. Today's close at 45.42 marks the lowest recorded closing price since March 4th. The bears were in full control today, moving the market lower throughout the whole session. Closing below Wednesday's low at 48.65, UltraPro Short confirmed its breakout through the previous session low after trading up to $3.65 below it intraday.
Daily Candlestick Chart (SDOW as at Mar 26, 2020):
Thursday's trading range has been $8.98 (16.72%), that's slightly below the last trading month's daily average range of $10.33. Things look different on the weekly timeframe, where the market's trading range of the last week has been way above the market's average weekly trading range. The longer-term, monthly volatility is currently notably higher than usual for SDOW.
One bearish candlestick pattern matches today's price action, the Black Candle.
Prices are trading close to the key technical support level at 37.02 (S1). The market closed below the 200-day moving average at 45.74 for the first time since March 4th. When this moving average was crossed below the last time on March 4th, SDOW actually gained 10.47% on the following trading day.
Though the ETF is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
With prices trading close to this year's low at 33.88, downside momentum might speed up should SDOW break out to new lows for the year. As prices are trading close to March's low at 41.30, downside momentum could accelerate should UltraPro Short mark new lows for the month.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Break through SMA 50" stand out. Its common bearish interpretation has been confirmed for UltraPro Short. Out of 78 times, SDOW closed lower 57.69% 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 70.51% with an average market move of -1.84%.