ALK still stuck within tight trading range
Alaska Air Group Inc. (ALK) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, ALK finished the month -5.02% lower at 34.44 after losing $0.22 (-0.63%) today, notably underperforming the S&P 500 (0.77%). Trading up to $0.56 lower after the open, the share managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (ALK as at Jul 31, 2020):
Friday's trading range has been $0.94 (2.75%), that's far below the last trading month's daily average range of $1.56. 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 ALK. Prices continued to consolidate within a tight trading range between 33.65 and 35.48 where it has been caught now for the whole last trading week.
One bullish candlestick pattern matches today's price action, the Hammer. The last time a Hammer showed up on April 3rd, ALK gained 8.02% on the following trading day.
Prices are trading close to the key technical resistance level at 35.38 (R1).
The stock shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying might accelerate should prices move above the close-by swing high at 35.48 where further buy stops could get triggered. Further selling might move prices lower should the market test June's nearby low at 33.00.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Hammer" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for Alaska Air. Out of 26 times, ALK closed lower 57.69% 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 61.54% with an average market move of -0.15%.