AVY closes below its opening price unable to hold early session gains
Avery Dennison Corporation (AVY) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, AVY finished Wednesday at 128.33 gaining $0.31 (0.24%) on high volume, outperforming the S&P 500 (-0.46%). Today's close at 128.33 marks the highest recorded closing price since February 21st. Trading $1.38 higher after the open, the share was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (AVY as at Sep 16, 2020):
Wednesday's trading range has been $1.72 (1.34%), that's below the last trading month's daily average range of $2.92. Things look different on the weekly timeframe, where the market's trading range of the last week has been way above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for AVY.
Four candlestick patterns are matching today's price action, the Bearish Doji Star, the Northern Doji and the Shooting Star which are known as bearish patterns and one neutral pattern, the Doji. The last time a Shooting Star showed up on Monday, AVY actually gained 5.10% on the following trading day.
With another close above the upper Bollinger Band, prices are confirming their strong upward momentum in the short-term. A drop back into the Bollinger Band on the next trading day though could signal a potential change in momentum that might lead to a correction back down towards the center of the Bollinger Bands at 118.03.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Doji" stand out. While it is usually interpreted as neutral, it has actually shown to be bullish for Avery Dennison. Out of 105 times, AVY closed higher 50.48% 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 59.05% with an average market move of 0.58%.