ADI dominated by bulls lifting the market higher throughout the day
Analog Devices Inc. (ADI) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, ADI ended the month 8.58% higher at 122.64 after gaining $3.64 (3.06%) today, notably outperforming the Nasdaq 100 (1.96%). 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 (ADI as at Jun 30, 2020):
Tuesday's trading range has been $4.19 (3.51%), that's above the last trading month's daily average range of $3.31. Things look different on the weekly timeframe, where the market's trading range of the last week has been below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly lower than usual for ADI.
One bullish candlestick pattern matches today's price action, the White Candle. The last time a White Candle showed up on June 15th, ADI gained 3.54% on the following trading day.
The stock managed to close back above the 20-day moving average at 121.11 for the first time since June 23rd. Prices are trading close to the key technical resistance level at 124.39 (R1).
Although Analog Devices is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Buying might accelerate should prices move above the close-by swing high at 124.51 where further buy stops could get triggered. With prices trading close to this year's high at 127.39, upside momentum might speed up 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 "Bullish Break through SMA 20" stand out. Though it is usually interpreted as bullish, it has actually shown to be bearish for Analog Devices. Out of 155 times, ADI closed lower 60.00% 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 nine trading days, showing a win rate of 49.68% with an average market move of -0.02%.