DRI closes higher for the 4th day in a row
Darden Restaurants Inc. (DRI) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, DRI ended Thursday at 60.56 gaining $2.11 (3.61%), notably underperforming the S&P 500 (6.24%). Trading up to $2.18 lower after the open, Darden Restaurants managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on Monday, DRI gained 31.34% on the following trading day. 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 (DRI as at Mar 26, 2020):
Thursday's trading range has been $6.14 (10.5%), that's below the last trading month's daily average range of $8.49. 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 higher than usual for DRI.
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 trading down to 56.30 earlier during the day, the market bounced off the key technical support level at 57.27 (S1). The failure to close below the support might increase that levels importance as support going forward.
Although the share is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Buying might accelerate should prices move above the close-by swing high at 67.72 where further buy stops could get activated.
Among the four 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 Darden Restaurants. Out of 452 times, DRI closed higher 58.19% 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 56.64% with an average market move of 0.52%.