DISCA runs into sellers around 21.33 for the third day in a row
Discovery Inc. Series A Common Stock (DISCA) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
DISCA ended the month -2.99% lower at 21.10 after edging lower $0.13 (-0.61%) today on low volume, significantly underperforming the S&P 500 (1.54%). 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 (DISCA as at Jun 30, 2020):
Tuesday's trading range has been $0.51 (2.41%), that's far below the last trading month's daily average range of $1.16. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for DISCA.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
Prices are trading close to the key technical support level at 20.71 (S1). Prices are trading close to the key technical resistance level at 21.81 (R1). The market ran into sellers again today around 21.33 for the third trading day in a row after having found sellers at 21.30 in the previous session and at 21.17 two days ago. The last time this happened on May 5th, DISCA lost -1.88% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Selling could speed up should prices move below the nearby swing low at 19.95 where further sell stops might get triggered.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to prior two Highs" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Discovery. Out of 120 times, DISCA closed higher 51.67% 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 six trading days, showing a win rate of 51.67% with an average market move of 0.10%.