AMD finds buyers around 76.54 for the third day in a row
Advanced Micro Devices Inc. (AMD) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
AMD finished Wednesday at 76.66 losing $2.27 (-2.88%), notably 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 prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (AMD as at Sep 16, 2020):
Wednesday's trading range has been $3.18 (4.01%), that's slightly below the last trading month's daily average range of $3.99. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for AMD. Prices continued to consolidate within a tight trading range between 75.97 and 80.33 where it has been caught now for the last three trading days.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, two candlestick patterns are matching today's price action, the Last Engulfing Bottom Pattern which is known as bullish pattern and one bearish pattern, the Black Candle. The last time a Last Engulfing Bottom Pattern showed up on September 10th, AMD actually lost -3.34% on the following trading day.
Prices are trading close to the key technical support level at 75.97 (S1). The stock found buyers again today around 76.54 for the third trading day in a row after having found demand at 75.97 in the previous session and at 76.26 two days ago.
Though Advanced Micro is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Buying could speed up should prices move above the close-by swing high at 80.33 where further buy stops might get activated. Selling could accelerate should prices move below the nearby swing low at 75.97 where further sell stops might get triggered.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Down Close Near Low of Period" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Advanced Micro. Out of 499 times, AMD closed higher 51.30% 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 57.72% with an average market move of 1.69%.