DBX closes within prior day's range after lackluster session
Dropbox Inc (DBX) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
DBX finished the week 2.38% higher at 18.53 after losing $0.08 (-0.43%) today, underperforming the S&P 500 (0.18%) ahead of tomorrow's Presidents' Day market holiday. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (DBX as at Feb 14, 2020):
Friday's trading range has been $0.23 (1.24%), that's below the last trading month's daily average range of $0.48. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for DBX. Prices continued to consolidate within a tight trading range between 18.30 and 18.76 where it has been caught now for the last three trading days.
Prices are trading close to the key technical resistance level at 18.76 (R1). After having been unable to move lower than 18.45 in the previous session, Dropbox found buyers again around the same price level today at 18.41. The last time this happened on February 6th, DBX actually lost -0.88% on the following trading day.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying might accelerate should prices move above the close-by swing high at 18.76 where further buy stops could get activated. Selling might speed up should prices move below the nearby swing low at 18.30 where further sell stops could get triggered. With prices trading close to this year's high at 18.86, upside momentum might accelerate should the stock be able to break out to new highs for the year.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. While it is usually interpreted as neutral, it has actually shown to be bullish for Dropbox. Out of 136 times, DBX closed higher 56.62% 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 47.79% with an average market move of 0.30%.