BZUN finds buyers at key support level
Baozun Inc. (BZUN) Technical Analysis Report for May 29, 2020 | by Techniquant Editorial Team
BZUN finished the month -16.8% lower at 26.49 after gaining $0.28 (1.07%) today on high volume, outperforming the S&P 500 (0.48%). Trading up to $0.41 lower after the open, Baozun managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on May 21st, BZUN actually lost -8.91% on the following trading day. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (BZUN as at May 29, 2020):
Friday's trading range has been $0.95 (3.64%), that's below the last trading month's daily average range of $1.46. 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 BZUN.
After trading down to 25.69 earlier during the day, the stock bounced off the key technical support level at 25.74 (S1). The failure to close below the support could increase that levels importance as support going forward.
The share shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Further selling might move prices lower should the market test April's close-by low at 25.38.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for Baozun. Out of 165 times, BZUN closed higher 64.24% 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 61.82% with an average market move of 5.05%.