DHI closes higher for the 2nd day in a row
D.R. Horton Inc. (DHI) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, DHI ended the week 1.83% higher at 61.81 after edging higher $0.14 (0.23%) today, slightly outperforming the S&P 500 (0.18%) ahead of tomorrow's Presidents' Day market holiday. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (DHI as at Feb 14, 2020):
Friday's trading range has been $0.70 (1.13%), that's far below the last trading month's daily average range of $1.26. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for DHI. Prices continued to consolidate within a tight trading range between 60.85 and 62.12 where it has been caught now for the whole last trading week.
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. The last time this happened on January 2nd, DHI actually gained 0.74% on the following trading day.
After having been unable to move lower than 61.48 in the previous session, the market found buyers again around the same price level today at 61.39.
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 close-by swing high at 62.12 where further buy stops might get triggered. Selling could accelerate should prices move below the nearby swing low at 61.08 where further sell stops might get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to prior High" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for D. R. Horton. Out of 544 times, DHI closed higher 52.57% 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 58.27% with an average market move of 1.14%.