DISCA pushes through Tuesday's high
Discovery Inc. Series A Common Stock (DISCA) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, DISCA finished Wednesday at 24.27 gaining $0.45 (1.89%), strongly outperforming the S&P 500 (-0.46%). Today's close at 24.27 marks the highest recorded closing price since June 8th. Closing above Tuesday's high at 24.12, the market confirmed its breakout through the previous session high after trading up to $0.64 above it intraday.
Daily Candlestick Chart (DISCA as at Sep 16, 2020):
Wednesday's trading range has been $0.87 (3.63%), that's slightly above the last trading month's daily average range of $0.75. Weekly volatility is also higher, being above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for DISCA.
After spiking up to 24.76 during the day, the stock found resistance at the 200-day moving average at 24.60. The last time this happened on January 16, 2019, DISCA actually gained 0.70% on the following trading day.
Crossing above the upper Bollinger Band for the first time since Monday, prices have shown unusually strong upward momentum in the short-term. This could either indicate a potential buying climax after which prices might head back down towards the mean of the Bollinger Bands at 22.70 or signal the beginning of a strong momentum breakout leading to even higher prices.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Bounce off SMA 200" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Discovery. Out of 16 times, DISCA closed higher 62.50% 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 50.00% with an average market move of 1.41%.