BBY closes within prior day's range after lackluster session
Best Buy Co. Inc. (BBY) Technical Analysis Report for Jun 01, 2020 | by Techniquant Editorial Team
BBY finished Monday at 77.50 losing $0.59 (-0.76%), strongly underperforming the S&P 500 (0.38%). Trading up to $0.95 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on April 16th, BBY gained 8.34% on the following trading day. 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 (BBY as at Jun 01, 2020):
Monday's trading range has been $1.92 (2.49%), that's far below the last trading month's daily average range of $3.24. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for BBY.
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, one bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
Prices are trading close to the key technical support level at 77.04 (S1). The stock closed back below the 20-day moving average at 78.08.
Best Buy shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying could accelerate should prices move above the nearby swing high at 81.34 where further buy stops might get triggered. Selling could speed up should prices move below the close-by swing low at 75.53 where further sell stops might get activated. Further selling could move prices lower should the market test May's nearby low at 70.71.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for Best Buy. Out of 730 times, BBY closed higher 51.37% 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 1.16%.