DG closes within previous day's range after lackluster session
Dollar General Corporation (DG) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
DG ended the week -1.67% lower at 178.98 after gaining $0.57 (0.32%) today, slightly outperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial 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 (DG as at May 22, 2020):
Friday's trading range has been $2.39 (1.33%), that's far below the last trading month's daily average range of $4.09. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for DG.
One bullish candlestick pattern matches today's price action, the Takuri Line.
Prices are trading close to the key technical support level at 176.91 (S1). After having been unable to move above 179.48 in the previous session, Dollar General ran into sellers again around the same price level today, missing to move higher than 179.60. The last time this happened on Tuesday, DG lost -1.60% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Selling might speed up should prices move below the close-by swing low at 176.58 where further sell stops could get activated. As prices are trading close to May's low at 172.66, downside momentum might accelerate should the share mark new lows for the month.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Takuri Line" stand out. Its common bullish interpretation has been confirmed for Dollar General. Out of 49 times, DG closed higher 53.06% 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 61.22% with an average market move of 0.92%.