AVGO dominated by bulls lifting the market higher throughout the day
Broadcom Inc. (AVGO) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, AVGO ended Thursday at 243.17 gaining $25.62 (11.78%), notably outperforming the Nasdaq 100 (5.72%). The bulls were in full control today, moving the market higher 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 (AVGO as at Mar 26, 2020):
Thursday's trading range has been $18.77 (8.3%), that's slightly below the last trading month's daily average range of $21.20. Things look different on the weekly timeframe, where the market's trading range of the last week has been above the market's average weekly trading range. The longer-term, monthly volatility is currently significantly higher than usual for AVGO.
One bullish candlestick pattern matches today's price action, the White Candle.
The market managed to close above the 20-day moving average at 233.95 for the first time since February 14th. When this moving average was crossed above the last time on February 4th, AVGO gained 1.85% on the following trading day. Prices are trading close to the key technical resistance level at 263.68 (R1). After having been unable to move above 244.00 in the prior session, the stock ran into sellers again around the same price level today, failing to move higher than 244.80.
Though Broadcom is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bullish Break through SMA 20" stand out. Its common bullish interpretation has been confirmed for Broadcom. Out of 140 times, AVGO closed higher 53.57% 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 57.14% with an average market move of 0.82%.