AAXN closes within prior day's range after lackluster session
Axon Enterprise Inc. (AAXN) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
AAXN ended Wednesday at 83.73 losing $0.67 (-0.79%), slightly underperforming the S&P 500 (-0.46%). The bears were in full control today, moving the market lower throughout the whole session. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (AAXN as at Sep 16, 2020):
Wednesday's trading range has been $1.59 (1.87%), that's far below the last trading month's daily average range of $2.78. 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 AAXN. Prices continued to consolidate within a tight trading range between 82.82 and 85.44 where it has been caught now for the last three trading days.
Despite a strong opening Axon Enterprise closed below the previous day's open and close, forming a bearish Engulfing Candle. The last time this candlestick pattern showed up on July 6th, AAXN lost -3.59% on the following trading day. Additionally, three candlestick patterns are matching today's price action, the Bearish Hikkake Pattern, the Bearish Short Candle and the Black Candle which are known as bearish patterns.
Prices are trading close to the key technical support level at 82.82 (S1). The share closed back below the 20-day moving average at 84.17 for the first time since September 8th. After having been unable to move lower than 83.05 in the prior session, the stock found buyers again around the same price level today at 83.41.
While still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Buying might accelerate should prices move above the close-by swing high at 85.44 where further buy stops could get triggered. Selling might speed up should prices move below the nearby swing low at 82.82 where further sell stops could get activated. Further selling might move prices lower should the market test August's close-by low at 78.28.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Decisive Down Move" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Axon Enterprise. Out of 274 times, AAXN closed higher 57.66% 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 58.39% with an average market move of 3.06%.