CAR falls to lowest close since August 17th
Avis Budget Group Inc. (CAR) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, CAR finished Wednesday at 31.61 losing $0.90 (-2.77%), significantly underperforming the Dow Comp. (0.17%). Today's close at 31.61 marks the lowest recorded closing price since August 17th. Closing below Tuesday's low at 32.33, Avis Budget confirmed its breakout through the previous session low after trading up to $0.81 below it intraday.
Daily Candlestick Chart (CAR as at Sep 16, 2020):
Wednesday's trading range has been $1.61 (4.93%), that's slightly below the last trading month's daily average range of $1.80. 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 slightly lower than usual for CAR.
One bearish candlestick pattern matches today's price action, the Black Candle.
Crossing below the lower Bollinger Band for the first time since March 5th, prices have shown unusually strong downward momentum in the short-term. This might either indicate a potential selling climax after which prices could head back up towards the mean of the Bollinger Bands at 33.93 or signal the beginning of a strong momentum breakout leading to even lower prices. The last time prices broke out below the lower Bollinger Band on March 5th, CAR lost -2.98% on the following trading day.
While the stock is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close below the lower Bollinger Band" stand out. Its common bearish interpretation has been confirmed for Avis Budget. Out of 132 times, CAR closed lower 52.27% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 57.58% with an average market move of -1.34%.