BBD closes within previous day's range after lackluster session
Banco Bradesco Sa American Depositary Shares (BBD) Technical Analysis Report for Jan 22, 2020 | by Techniquant Editorial Team
BBD ended Wednesday at 8.02 gaining $0.10 (1.26%) on high volume, notably outperforming the S&P 500 (0.03%). Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (BBD as at Jan 22, 2020):
Wednesday's trading range has been $0.10 (1.24%), that's below the last trading month's daily average range of $0.15. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for BBD.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, two candlestick patterns are matching today's price action, the Homing Pigeon and the Takuri Line which are both known as bullish patterns.
Prices are trading close to the key technical support level at 7.92 (S1). Prices are trading close to the key technical resistance level at 8.19 (R1). After having been unable to move lower than 7.92 in the previous session, Banco Bradesco found buyers again around the same price level today at 7.95.
Crossing above the lower Bollinger Band, prices have lost at least some of their downward momentum in the short-term and could now be heading back up towards the mean of the Bollinger Bands at 8.63. The last time this happened on January 16th, BBD gained 2.43% on the following trading day.
Though still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Selling might accelerate should prices move below the nearby swing low at 7.92 where further sell stops could get activated. Further selling might move prices lower should the market test December's close-by low at 7.91.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Homing Pigeon" stand out. Its common bullish interpretation has been confirmed for Banco Bradesco. Out of 19 times, BBD closed higher 52.63% 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 nine trading days, showing a win rate of 68.42% with an average market move of 0.98%.