DHI breaks back above 20-day moving average
D.R. Horton Inc. (DHI) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, DHI ended the month 0.27% higher at 55.45 after gaining $0.83 (1.52%) today on low volume, slightly underperforming the S&P 500 (1.54%). Trading up to $0.80 lower after the open, the stock managed to reverse during the session as bulls took control ending the day above its opening price. Closing above Monday's high at 55.02, D. R. Horton confirmed its breakout through the previous session high after trading up to $0.73 above it intraday.
Daily Candlestick Chart (DHI as at Jun 30, 2020):
Tuesday's trading range has been $1.70 (3.1%), that's below the last trading month's daily average range of $2.38. 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 DHI.
The market managed to close back above the 20-day moving average at 55.43 for the first time since June 23rd. When this moving average was crossed above the last time on June 15th, DHI gained 3.81% on the following trading day.
The share shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish. With its 50-day moving average crossing above its 200-day moving average, DHI has entered a so-called "Golden Cross" for the first time since April 1st. Showing increasing upward momentum in the short and medium-term the "Golden Cross" is known to indicate a potential bull market on the horizon.
Buying could speed up should prices move above the close-by swing high at 57.32 where further buy stops might get triggered.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Golden Cross" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for D. R. Horton. Out of 6 times, DHI closed lower 66.67% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 50.00% with an average market move of 0.06%.