DO closes within prior day's range
Diamond Offshore Drilling Inc. (DO) Technical Analysis Report for Sep 13, 2019 | by Techniquant Editorial Team
DO ended the week 4.48% higher at 7.69 after losing $0.09 (-1.16%) today on low volume, notably underperforming the S&P 500 (-0.07%). Trading $0.22 higher after the open, Diamond Offshore was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on Tuesday, DO actually gained 0.65% on the following trading day. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (DO as at Sep 13, 2019):
Friday's trading range has been $0.51 (6.49%), that's slightly above the last trading month's daily average range of $0.47. 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 DO.
Prices are trading close to the key technical support level at 7.52 (S1).
Although the market is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could speed up should prices move above the nearby swing high at 8.10 where further buy stops might get activated. Selling could accelerate should prices move below the close-by swing low at 7.17 where further sell stops might get triggered.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Bearish Intraday Reversal" stand out. Its common bearish interpretation has been confirmed for Diamond Offshore. Out of 412 times, DO closed lower 52.67% 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 49.76% with an average market move of -0.07%.