DO closes lower for the 2nd day in a row
Diamond Offshore Drilling Inc. (DO) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, DO ended the week -14.58% lower at 3.75 after edging lower $0.05 (-1.32%) today, notably underperforming the S&P 500 (0.18%) ahead of tomorrow's Presidents' Day market holiday. Today's close at 3.75 marks the lowest recorded closing price ever. Trading $0.08 higher after the open, the market was unable to hold its gains as the bears took control ending the day below 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 (DO as at Feb 14, 2020):
Friday's trading range has been $0.24 (6.32%), that's below the last trading month's daily average range of $0.33. 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 DO.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top. The last time a Bearish Spinning Top showed up on February 7th, DO lost -9.34% on the following trading day.
After trading down to 3.64 earlier during the day, Diamond Offshore bounced off the key technical support level at 3.65 (S1). The failure to close below the support could increase that levels significance as support going forward.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for Diamond Offshore. Out of 421 times, DO closed higher 54.39% 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 four trading days, showing a win rate of 53.68% with an average market move of 0.23%.