DVN stuck within tight trading range
Devon Energy Corporation (DVN) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, DVN finished the month 4.9% higher at 11.34 after gaining $0.22 (1.98%) today, slightly outperforming the S&P 500 (1.54%). Closing above Monday's high at 11.20, Devon Energy confirmed its breakout through the prior session high after trading up to $0.23 above it intraday.
Daily Candlestick Chart (DVN as at Jun 30, 2020):
Tuesday's trading range has been $0.65 (5.94%), that's below the last trading month's daily average range of $0.87. 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 DVN. Prices continued to consolidate within a tight trading range between 10.76 and 11.57 where it has been caught now for the last three trading days.
Two candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns. The last time a White Candle showed up on June 25th, DVN actually lost -6.50% on the following trading day.
After trading down to 10.78 earlier during the day, the market bounced off the key technical support level at 10.79 (S1). The failure to close below the support could increase that levels importance as support going forward. The share found buyers again today around 10.78 for the third trading day in a row after having found demand at 10.76 in the previous session and at 10.85 two days ago.
The stock shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Selling might accelerate should prices move below the nearby swing low at 10.76 where further sell stops could get triggered. As prices are trading close to June's low at 10.62, downside momentum might speed up should DVN mark new lows for the month.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Short Candle" stand out. Its common bullish interpretation has been confirmed for Devon Energy. Out of 81 times, DVN closed higher 53.09% 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 58.02% with an average market move of 1.32%.