EA runs into sellers again around 120.01
Electronic Arts Inc. (EA) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
EA ended the week 1.43% higher at 119.82 after gaining $2.46 (2.1%) today on low volume, strongly outperforming the Nasdaq 100 (0.38%) ahead of tomorrow's Memorial Day market holiday. Today's close at 119.82 marks the highest recorded closing price since September 28, 2018. The bulls were in full control today, moving the market higher throughout the whole session. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (EA as at May 22, 2020):
Friday's trading range has been $3.40 (2.9%), that's slightly above the last trading month's daily average range of $3.22. 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 lower than usual for EA.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bullish Outside Bar. Additionally, one bullish candlestick pattern matches today's price action, the White Candle.
Buyers managed to take out the key technical resistance level at 118.47 (now S1), which is likely to act as support going forward. The last time this happened on May 5th, EA actually lost -3.59% on the following trading day. After having been unable to move above 119.88 in the prior session, the market ran into sellers again around the same price level today, failing to move higher than 120.01.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could accelerate should prices move above the nearby swing high at 121.76 where further buy stops might get activated.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for Electronic Arts. Out of 790 times, EA closed higher 53.42% 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 58.23% with an average market move of 0.81%.