DLTR finds buyers at key support level
Dollar Tree Inc. (DLTR) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
DLTR finished the month -5.3% lower at 92.68 after losing $0.99 (-1.06%) today, strongly underperforming the Nasdaq 100 (1.96%). Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (DLTR as at Jun 30, 2020):
Tuesday's trading range has been $2.88 (3.1%), that's slightly below the last trading month's daily average range of $2.97. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently significantly lower than usual for DLTR.
Three candlestick patterns are matching today's price action, the Hanging Man and the Northern Doji which are both known as bearish patterns and one neutral pattern, the Doji. The last time a Hanging Man showed up on April 17th, DLTR lost -3.11% on the following trading day.
After trading down to 90.65 earlier during the day, Dollar Tree bounced off the key technical support level at 91.81 (S1). The failure to close below the support could increase that levels significance as support going forward.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Northern Doji" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Dollar Tree. Out of 71 times, DLTR closed higher 56.34% 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 64.79% with an average market move of 1.62%.