CHKP unable to break through key resistance level
Check Point Software Technologies Ltd. (CHKP) Technical Analysis Report for Mar 27, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, CHKP finished the week 10.38% higher at 99.07 after gaining $3.57 (3.74%) today, significantly outperforming the Nasdaq 100 (-3.91%). Closing above Thursday's high at 97.38, the share confirmed its breakout through the previous session high after trading up to $4.18 above it intraday.
Daily Candlestick Chart (CHKP as at Mar 27, 2020):
Friday's trading range has been $9.55 (10.22%), that's far above the last trading month's daily average range of $6.29. Weekly volatility is also higher, being above the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for CHKP.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bullish Outside Bar. Additionally, two candlestick patterns are matching today's price action, the White Candle which is known as bullish pattern and one bearish pattern, the Last Engulfing Top Pattern. The last time a White Candle showed up on March 17th, CHKP actually lost -7.78% on the following trading day.
Unable to break through the key technical resistance level at 100.31 (R1), the market closed below it after spiking up to 101.56 earlier during the day. The failure to close above the resistance could increase that levels importance going forward.
While Check Point is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
As prices are trading close to March's high at 104.90, upside momentum could speed up should the stock mark new highs for the month.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "White Candle" stand out. Its common bullish interpretation has been confirmed for Check Point. Out of 581 times, CHKP closed higher 52.32% 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 56.28% with an average market move of 0.39%.