ANSS breaks below Tuesday's low
ANSYS Inc. (ANSS) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
ANSS finished Wednesday at 317.89 losing $10.32 (-3.14%), notably underperforming the S&P 500 (-0.46%). The bears were in full control today, moving the market lower throughout the whole session. Closing below Tuesday's low at 321.77, the stock confirmed its breakout through the prior session low after trading up to $4.29 below it intraday.
Daily Candlestick Chart (ANSS as at Sep 16, 2020):
Wednesday's trading range has been $13.96 (4.21%), that's above the last trading month's daily average range of $9.67. 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 slightly higher than usual for ANSS.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bearish Outside Bar. Regardless of a strong opening the share closed below the previous day's open and close, forming a bearish Engulfing Candle. Additionally, two candlestick patterns are matching today's price action, the Bearish Belt-hold and the Black Candle which are both known as bearish patterns.
The market closed back below the 20-day moving average at 326.97. When this moving average was crossed below the last time on September 4th, ANSS lost -3.92% on the following trading day. After having been unable to move above 330.03 in the prior session, ANSYS ran into sellers again around the same price level today, missing to move higher than 331.44.
Though ANSS is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Selling could accelerate should prices move below the close-by swing low at 309.74 where further sell stops might get activated. Further selling could move prices lower should the market test August's nearby low at 300.48.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Break through SMA 20" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for ANSYS. Out of 154 times, ANSS closed higher 62.34% 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 59.09% with an average market move of 1.01%.