CREE closes below its opening price unable to hold early session gains
Cree Inc. (CREE) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, CREE finished the month 16.44% higher at 68.92 after edging lower $0.21 (-0.3%) today, significantly underperforming the S&P 500 (0.77%). Trading $0.91 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (CREE as at Jul 31, 2020):
Friday's trading range has been $2.64 (3.82%), that's slightly above the last trading month's daily average range of $2.35. Things look different on the weekly timeframe, where the market's trading range of the last week has been below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for CREE.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bearish Outside Bar. In spite of a strong opening the share closed below the previous day's open and close, forming a bearish Engulfing Candle. The last time this candlestick pattern showed up on July 13th, CREE actually gained 5.89% on the following trading day. Additionally, two candlestick patterns are matching today's price action, the Bearish Spinning Top and the Bearish High-Wave Candle which are both known as bearish patterns.
Prices are trading close to the key technical resistance level at 70.22 (R1).
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could speed up should prices move above the nearby swing high at 70.22 where further buy stops might get triggered.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bearish High-Wave Candle" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Cree. Out of 22 times, CREE closed higher 54.55% of the time on the next trading day after the market condition occurred.