DFS closes higher for the 2nd day in a row
Discover Financial Services (DFS) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, DFS finished the month 5.43% higher at 50.09 after gaining $0.77 (1.56%) today, slightly outperforming the S&P 500 (1.54%). Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (DFS as at Jun 30, 2020):
Tuesday's trading range has been $1.76 (3.58%), that's far below the last trading month's daily average range of $3.18. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for DFS.
Regardless of a weak opening Discover Financial managed to close above the prior day's open and close, forming a bullish Engulfing Candle. Additionally, one bearish candlestick pattern matches today's price action, the Bearish Hikkake Pattern. The last time a Bearish Hikkake Pattern showed up on June 23rd, DFS lost -7.38% on the following trading day.
After having been unable to move lower than 48.30 in the previous session, the share found buyers again around the same price level today at 48.71.
The market shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Selling might accelerate should prices move below the close-by swing low at 47.35 where further sell stops could get triggered.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for Discover Financial. Out of 691 times, DFS closed higher 53.98% 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 59.48% with an average market move of 1.16%.