AVT runs into sellers around 26.76 for the forth day in a row
Avnet Inc. (AVT) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
AVT ended the month -4.2% lower at 26.72 after edging lower $0.02 (-0.07%) today on low volume, underperforming the S&P 500 (0.77%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (AVT as at Jul 31, 2020):
Friday's trading range has been $0.51 (1.91%), that's far below the last trading month's daily average range of $0.72. 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 AVT. Prices continued to consolidate within a tight trading range between 25.86 and 26.82 where it has been caught now for the whole last trading week.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Hanging Man.
After trading down to 26.25 earlier during the day, the market bounced off the key technical support level at 26.67 (S1). The failure to close below the support could increase that levels importance as support going forward. When prices bounced off a significant support level the last time on July 15th, AVT actually lost -1.84% on the following trading day. The share was sold again around 26.76 after having seen highs at 26.79, 26.82 and 26.71 in the last three trading sessions. Obviously there is something going on at that level.
Although Avnet is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could speed up should prices move above the close-by swing high at 26.82 where further buy stops might get activated. Selling could accelerate should prices move below the nearby swing low at 25.86 where further sell stops might get triggered.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to prior two Highs" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Avnet. Out of 128 times, AVT closed higher 57.03% of the time on the next trading day after the market condition occurred.