CARG pushes through Wednesday's high
CarGurus Inc. (CARG) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, CARG finished Thursday at 20.52 gaining $0.53 (2.65%) on low volume, notably underperforming the S&P 500 (6.24%). Closing above Wednesday's high at 20.47, the stock confirmed its breakout through the prior session high after trading up to $0.47 above it intraday.
Daily Candlestick Chart (CARG as at Mar 26, 2020):
Thursday's trading range has been $0.94 (4.64%), that's 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 CARG.
The share managed to close above the 20-day moving average at 20.38 for the first time since January 23rd. When this moving average was crossed above the last time on January 15th, CARG gained 4.78% on the following trading day. Prices are trading close to the key technical resistance level at 21.07 (R1).
Although CarGurus is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could speed up should prices move above the nearby swing high at 21.07 where further buy stops might get triggered.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. Though it is usually interpreted as neutral, it has actually shown to be bullish for CarGurus. Out of 171 times, CARG closed higher 50.29% 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 52.05% with an average market move of 0.27%.