DG tanks, losing $9.04 (-7.49%) within a single day on high volume
Dollar General Corporation (DG) Technical Analysis Report for Mar 14, 2019 | by Techniquant Editorial Team
DG ended Thursday at 111.64 tanking $9.04 (-7.49%) on high volume, notably underperforming the S&P 500 (-0.09%) following today's earnings report. This is the biggest single-day loss in over nine months. The last time we've seen such an unusually strong single-day loss on December 4, 2018, DG actually gained 2.48% on the following trading day. Today's close at 111.64 marks the lowest recorded closing price since January 4th. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (DG as at Mar 14, 2019):
DG reported earnings of $1.84 per share before today's market open. With analysts having expected an EPS of $1.86, Dollar General Corporation missed market expectations by -1.1%. The company's last earnings report was released on Dec. 4, 2018, when Dollar General Corporation reported earnings of $1.26 per share meeting market expectations.
Thursday's trading range has been $3.72 (3.33%), that's far above the last trading month's daily average range of $1.74. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently strongly higher than usual for DG.
Three candlestick patterns are matching today's price action, the Southern Doji which is known as bullish pattern, one bearish pattern, the Hanging Man and one neutral pattern, the Doji.
Dollar General closed below the 100-day moving average at 112.41 for the first time since January 3rd.
Crossing below the lower Bollinger Band for the first time since November 21, 2018, prices have shown unusually strong downward momentum in the short-term. This could either indicate a potential selling climax after which prices might head back up towards the mean of the Bollinger Bands at 118.64 or signal the beginning of a strong momentum breakout leading to even lower prices.
Although the share is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Among the 15 market conditions that our pattern recognition engine identified today, the statistics for the Stock Earning Report based market condition "Trading Day post weak Earnings Report" stand out. Though it is usually interpreted as neutral, it has actually shown to be bullish for Dollar General. Out of 7 times, DG closed higher 85.71% 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 85.71% with an average market move of 4.40%.