CREE closes below its opening price unable to hold early session gains
Cree Inc. (CREE) Technical Analysis Report for May 17, 2019 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, CREE ended the week -2.09% lower at 63.15 after losing $1.10 (-1.71%) today, significantly underperforming the S&P 500 (-0.58%). Trading $0.69 higher after the open, the stock was unable to hold its gains as the bears took control ending the day below its opening price. Ending with a weak close near the low of the day sets a bearish note for the next session.
Daily Candlestick Chart (CREE as at May 17, 2019):
Friday's trading range has been $1.40 (2.2%), that's below the last trading month's daily average range of $2.31. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for CREE.
Unable to break through the key technical resistance level at 63.80 (R1), the market closed below it after spiking up to 64.34 earlier during the day. The failure to close above the resistance could increase that levels significance going forward.
Though Cree 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 five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Cree. Out of 300 times, CREE closed higher 53.00% 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 52.67% with an average market move of 0.74%.