DISCA breaks below 100-day moving average

Discovery Communications-A (DISCA) Technical Analysis Report for May 17, 2018

Highlights

DISCA finds buyers around 22.80 for the third day in a row
DISCA dominated by bears dragging the market lower throughout the day
DISCA breaks below 100-day moving average
DISCA finds buyers at key support level
DISCA stuck within tight trading range

TQ Sentiment

Report Sentiment:
40% Bearish
Technical Forecast:
TQ Pro Only
See the overall Technical Analysis forecast for today.

Overview

DISCA finished Thursday at 23.02 losing $0.67 (-2.83%). The bears were in full control today, moving the market lower throughout the whole session. Closing within the previous day's range, prices failed to decisively move past the prior day's trading range.

Daily chart for DISCA

Volatility

Thursday's trading range was $0.89 (3.76%), that's slightly above last trading month's daily average range of $0.83. Things look different on a weekly scale, where volatility is slightly below the markets average with the monthly volatility being slightly below average. Prices continued to consolidate within a tight trading range between 22.68 and 23.90 which it has been in now for the last three days.

Price Action

During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Regardless of a strong opening the market closed below the prior day's open and close, forming a bearish Engulfing Candle. After moving higher in the previous session, the stock closed lower but above the prior day's open today, forming a bearish Harami Candle.

Support/Resistance

After trading as low as 22.80 during the day, the share bounced off the key support level at 22.92. The failure to close below the support might increase that levels importance as support going forward. Discovery found buyers again today around 22.80 for the third trading day in a row after having found demand at 22.68 in the previous session and at 22.83 two days ago.

Trend

While DISCA is experiencing a short-term up trend, this could just be a correction, as both the medium and long term trends are still in negative territory. The market broke below the 100-day moving average at 23.55 today for the first time since May 15th.

Order Flow

Selling might accelerate should prices move below the close-by swing low at 22.68 where further sell stops could get activated.

Conclusion

While classical technical analysis indicates a neutral sentiment for the next trading day, our quantitative statistics show a different picture being bearish.

Market Conditions for Discovery Communications-A

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DISCA ends the day indecisive

Sep 24, 2018
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