BIIB still stuck within tight trading range
Biogen Inc. (BIIB) Technical Analysis Report for Feb 20, 2020 | by Techniquant Editorial Team
BIIB ended Thursday at 336.64 losing $4.40 (-1.29%), slightly underperforming the Nasdaq 100 (-0.94%). Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (BIIB as at Feb 20, 2020):
Thursday's trading range has been $10.50 (3.07%), that's slightly below the last trading month's daily average range of $12.45. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently notably higher than usual for BIIB. Prices continued to consolidate within a tight trading range between 329.00 and 344.00 where it has been caught now for the whole last trading week.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bearish Outside Bar. Despite a strong opening Biogen closed below the previous day's open and close, forming a bearish Engulfing Candle. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle.
Prices broke below the key technical support level at 340.05 (now R1), which is likely to act as resistance going forward. The last time this happened on January 23rd, BIIB lost -2.14% on the following trading day. After having been unable to move above 341.77 in the prior session, the share ran into sellers again around the same price level today, failing to move higher than 343.00.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might speed up should prices move above the close-by swing high at 344.00 where further buy stops could get triggered. Selling might accelerate should prices move below the nearby swing low at 329.00 where further sell stops could get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish Engulfing Candle" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Biogen. Out of 96 times, BIIB closed higher 60.42% 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 53.13% with an average market move of 1.39%.