DK closes within prior day's range after lackluster session
Delek US Holdings Inc. (DK) Technical Analysis Report for Jul 16, 2019 | by Techniquant Editorial Team
DK finished Tuesday at 39.11 gaining $0.29 (0.75%), notably outperforming the S&P 500 (-0.34%). Trading up to $0.42 lower after the open, the stock managed to reverse during the session as bulls took control ending the day above its opening price. 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 (DK as at Jul 16, 2019):
Tuesday's trading range has been $0.77 (1.98%), that's far below the last trading month's daily average range of $1.34. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for DK.
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. After moving lower in the prior session, the market managed to close higher but below the previous day's open, forming a bullish Harami Candle. Additionally, two candlestick patterns are matching today's price action, the Bullish Spinning Top and the Hammer which are both known as bullish patterns.
Buyers managed to take out the key technical resistance level at 39.06 (now S1), which is likely to act as support going forward. After having been unable to move lower than 38.51 in the prior session, Delek US found buyers again around the same price level today at 38.52. The last time this happened on July 12th, DK actually lost -2.76% on the following trading day.
Although the share is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Selling could speed up should prices move below the nearby swing low at 38.51 where further sell stops might get triggered.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Hammer" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for Delek US. Out of 23 times, DK closed lower 65.22% of the time on the next trading day after the market condition occurred.