BLDR rises to highest close since April 29th
Builders FirstSource Inc. (BLDR) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
BLDR ended the week 19.2% higher at 19.18 after gaining $0.74 (4.01%) today, strongly outperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Today's close at 19.18 marks the highest recorded closing price since April 29th. The bulls were in full control today, moving the market higher throughout the whole session. Closing above Thursday's high at 18.85, the stock confirmed its breakout through the prior session high after trading up to $0.36 above it intraday.
Daily Candlestick Chart (BLDR as at May 22, 2020):
Friday's trading range has been $0.93 (5.02%), that's slightly below the last trading month's daily average range of $1.14. 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 BLDR.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bullish Outside Bar. Additionally, one bullish candlestick pattern matches today's price action, the White Candle.
Buyers managed to take out the key technical resistance level at 18.87 (now S1), which is likely to act as support going forward. The last time this happened on April 23rd, BLDR gained 5.52% on the following trading day. After having been unable to move lower than 18.33 in the previous session, the market found buyers again around the same price level today at 18.28.
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Further buying might move prices higher should the market test April's nearby high at 20.16.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to prior low" stand out. Its common bullish interpretation has been confirmed for Builders FirstSource. Out of 591 times, BLDR closed higher 51.10% 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 54.31% with an average market move of 1.55%.