ADS closes below its opening price unable to hold early session gains
Alliance Data Systems Corporation (ADS) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, ADS finished Thursday at 37.55 edging lower $0.96 (-2.49%), notably underperforming the S&P 500 (6.24%). Trading $2.79 higher after the open, the share was unable to hold its gains as the bears took control ending the day below its opening price. Closing below Wednesday's low at 38.30, Alliance Data confirmed its breakout through the prior session low after trading up to $1.89 below it intraday.
Daily Candlestick Chart (ADS as at Mar 26, 2020):
Thursday's trading range has been $6.38 (15.95%), that's slightly above the last trading month's daily average range of $6.26. 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 higher than usual for ADS.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Alliance Data. Out of 295 times, ADS closed higher 52.20% 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 55.93% with an average market move of 0.02%.