SOXL breaks back above 20-day moving average
Direxion Daily Semiconductor Bull 3x Shares (SOXL) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, SOXL finished the month 22.13% higher at 188.21 after gaining $14.06 (8.07%) today. The bulls were in full control today, moving the market higher throughout the whole session. Ending with a strong close near the high of the day sets a bullish note for the next session.
Daily Candlestick Chart (SOXL as at Jun 30, 2020):
Tuesday's trading range has been $13.54 (7.68%), that's slightly above the last trading month's daily average range of $12.93. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for SOXL.
Two candlestick patterns are matching today's price action, the Bullish Belt-hold and the White Candle which are both known as bullish patterns.
The ETF managed to close back above the 20-day moving average at 180.76. When this moving average was crossed above the last time on June 25th, SOXL actually lost -5.99% on the following trading day. Prices are trading close to the key technical resistance level at 190.03 (R1).
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
As prices are trading close to June's high at 202.00, upside momentum might speed up should Direxion Daily mark new highs for the month.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Belt-hold" stand out. Though it is usually interpreted as bullish, it has actually shown to be bearish for Direxion Daily. Out of 21 times, SOXL closed lower 52.38% 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 71.43% with an average market move of -3.68%.