ACIA fails to close above 20-day moving average
Acacia Communications Inc. (ACIA) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
ACIA finished the week 0.95% higher at 67.90 after surging $0.67 (1.0%) today on high volume, outperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Closing above Thursday's high at 67.34, the share confirmed its breakout through the previous session high after trading up to $1.05 above it intraday.
Daily Candlestick Chart (ACIA as at May 22, 2020):
Friday's trading range has been $1.38 (2.05%), that's far above the last trading month's daily average range of $0.64. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for ACIA.
One bearish candlestick pattern matches today's price action, the Bearish Hikkake Pattern.
The market managed to close back above the 100-day moving average at 67.70 for the first time since May 14th. When this moving average was crossed above the last time on April 16th, ACIA gained 0.74% on the following trading day. After spiking up to 68.39 during the day, Acacia Communications found resistance at the 20-day moving average at 67.96. After having been unable to move lower than 66.91 in the prior session, the stock found buyers again around the same price level today at 67.01.
Although ACIA 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 high at 69.13, upside momentum might accelerate should the share be able to break out to new highs for the year.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Bounce off SMA 20" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Acacia Communications. Out of 23 times, ACIA closed higher 56.52% 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 two trading days, showing a win rate of 56.52% with an average market move of 2.64%.