CHKP rallies, gaining $4.35 (3.9%) within a single day on high volume
Check Point Software Technologies Ltd. (CHKP) Technical Analysis Report for Jul 07, 2020 | by Techniquant Editorial Team
Moving higher for the 6th day in a row, CHKP finished Tuesday at 115.88 surging $4.35 (3.9%) on high volume, significantly outperforming the Nasdaq 100 (-0.75%). This is the biggest single-day gain in over three months. Today's close at 115.88 marks the highest recorded closing price since February 21st. The bulls were in full control today, moving the market higher throughout the whole session. Closing above Monday's high at 111.54, Check Point confirmed its breakout through the prior session high after trading up to $5.46 above it intraday.
Daily Candlestick Chart (CHKP as at Jul 07, 2020):
Tuesday's trading range has been $6.30 (5.68%), that's far above the last trading month's daily average range of $2.72. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for CHKP.
One bullish candlestick pattern matches today's price action, the White Candle.
Buyers managed to take out the key technical resistance level at 112.96 (now S1), which is likely to act as support going forward.
Crossing above the upper Bollinger Band for the first time since June 5th, prices have shown unusually strong upward momentum in the short-term. This could either indicate a potential buying climax after which prices might head back down towards the mean of the Bollinger Bands at 107.97 or signal the beginning of a strong momentum breakout leading to even higher prices. The last time prices broke out above the upper Bollinger Band on June 5th, CHKP actually lost -0.05% on the following trading day.
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
With prices trading close to this year's high at 119.67, upside momentum could accelerate should the stock be able to break out to new highs for the year.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "6 Consecutive Higher Closes" stand out. Its common bullish interpretation has been confirmed for Check Point. Out of 23 times, CHKP closed higher 60.87% 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 65.22% with an average market move of 1.01%.