DISCK runs into sellers around 28.97 for the third day in a row
Discovery Inc. (DISCK) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
DISCK ended the week 1.34% higher at 28.73 after losing $0.17 (-0.59%) today on low volume, underperforming the S&P 500 (0.18%) ahead of tomorrow's Presidents' Day market holiday. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (DISCK as at Feb 14, 2020):
Friday's trading range has been $0.41 (1.42%), that's below the last trading month's daily average range of $0.59. 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 DISCK. Prices continued to consolidate within a tight trading range between 28.41 and 29.02 where it has been caught now for the last three trading days.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar.
Prices are trading close to the key technical support level at 28.55 (S1). The stock closed back below the 20-day moving average at 28.77. The market ran into sellers again today around 28.97 for the third trading day in a row after having found sellers at 29.02 in the previous session and at 29.02 two days ago. The last time this happened on October 24, 2019, DISCK lost -0.08% on the following trading day.
Discovery shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
Buying could speed up should prices move above the close-by swing high at 29.30 where further buy stops might get triggered. With prices trading close to this year's low at 27.60, downside momentum could accelerate should the share break out to new lows for the year.
Among the five 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. Its common bearish interpretation has been confirmed for Discovery. Out of 117 times, DISCK closed lower 56.41% 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 51.28% with an average market move of -0.29%.