DLTR rises to highest close since April 17th
Dollar Tree Inc. (DLTR) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, DLTR ended the week 8.83% higher at 81.70 after gaining $0.48 (0.59%) today, slightly outperforming the Nasdaq 100 (0.38%) ahead of tomorrow's Memorial Day market holiday. Today's close at 81.70 marks the highest recorded closing price since April 17th. Trading up to $1.62 lower after the open, the stock managed to reverse during the session as bulls took control ending the day above its opening price. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (DLTR as at May 22, 2020):
Friday's trading range has been $2.62 (3.22%), that's slightly above the last trading month's daily average range of $2.61. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for DLTR.
One bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
After spiking up to 82.41 during the day, Dollar Tree found resistance at the 100-day moving average at 82.40. The last time this happened on August 29, 2019, DLTR actually gained 3.95% on the following trading day.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Selling could speed up should prices move below the close-by swing low at 78.83 where further sell stops might get activated. Further buying could move prices higher should the market test April's nearby high at 82.89.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Bounce off SMA 100" stand out. Its common bearish interpretation has been confirmed for Dollar Tree. Out of 15 times, DLTR closed lower 80.00% 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 two trading days, showing a win rate of 60.00% with an average market move of -0.20%.