CDNS breaks back above 20-day moving average
Cadence Design Systems Inc. (CDNS) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
CDNS finished Thursday at 66.94 gaining $5.59 (9.11%) on low volume, notably outperforming the Nasdaq 100 (5.72%). Today's close at 66.94 marks the highest recorded closing price since March 5th. The bulls were in full control today, moving the market higher throughout the whole session. Closing above Wednesday's high at 64.60, the market confirmed its breakout through the previous session high after trading up to $2.49 above it intraday.
Daily Candlestick Chart (CDNS as at Mar 26, 2020):
Thursday's trading range has been $5.70 (9.21%), that's far above the last trading month's daily average range of $4.30. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for CDNS.
One bullish candlestick pattern matches today's price action, the White Candle.
The share managed to close back above the 20-day moving average at 61.70. When this moving average was crossed above the last time on Tuesday, CDNS actually lost -3.14% on the following trading day. Prices are trading close to the key technical resistance level at 67.41 (R1). After having been unable to move lower than 60.93 in the prior session, the stock found buyers again around the same price level today at 61.39.
Cadence Design shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
As prices are trading close to March's high at 70.39, upside momentum could accelerate should CDNS mark new highs for the month.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to previous low" stand out. Its common bullish interpretation has been confirmed for Cadence Design. Out of 538 times, CDNS closed higher 55.39% 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 61.15% with an average market move of 1.25%.