AVGO closes within prior day's range
Broadcom Inc. (AVGO) Technical Analysis Report for Oct 12, 2018 | by Techniquant Editorial Team
AVGO finished the week -4.62% lower at 232.95 after gaining $4.05 (1.77%) today, underperforming the Nasdaq 100 (2.77%). Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (AVGO as at Oct 12, 2018):
Friday's trading range has been $6.52 (2.78%), that's above the last trading month's daily average range of $5.07. Weekly volatility is also higher, being above the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for AVGO.
One bullish candlestick pattern matches today's price action, the Hammer. The last time a Hammer showed up on April 27th, AVGO actually lost -1.44% on the following trading day.
After having been unable to move above 235.60 in the prior session, the market ran into sellers again around the same price level today, failing to move higher than 235.63.
Crossing above the lower Bollinger Band, prices have lost at least some of their downward momentum in the short-term and might now be heading back up towards the mean of the Bollinger Bands at 243.21.
The stock shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Selling could accelerate should prices move below the nearby swing low at 227.19 where further sell stops might get activated.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Hammer" stand out. Its common bullish interpretation has been confirmed for Avago Technologies. Out of 20 times, AVGO closed higher 65.00% 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 60.00% with an average market move of 1.34%.