EL surges, gaining $4.51 (2.34%) within a single day on high volume
Estee Lauder Companies Inc. (EL) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, EL finished the month 4.7% higher at 197.54 after surging $4.51 (2.34%) today on high volume, significantly outperforming the S&P 500 (0.77%). This is the biggest single-day gain in over two weeks. The last time we've seen such an unusually strong single-day gain on July 14th, EL gained 1.86% on the following trading day. The bulls were in full control today, moving the market higher throughout the whole session. Closing above Thursday's high at 193.87, Estee Lauder confirmed its breakout through the previous session high after trading up to $3.92 above it intraday.
Daily Candlestick Chart (EL as at Jul 31, 2020):
Friday's trading range has been $5.44 (2.82%), that's far above the last trading month's daily average range of $3.76. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for EL.
One bullish candlestick pattern matches today's price action, the White Candle.
The stock managed to close back above the 20-day moving average at 193.43. Prices are trading close to the key technical resistance level at 199.90 (R1).
Though the market is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
As prices are trading close to July's high at 201.53, upside momentum could accelerate should the share mark new highs for the month.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "White Candle" stand out. Its common bullish interpretation has been confirmed for Estee Lauder. Out of 576 times, EL closed higher 53.47% 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 59.90% with an average market move of 0.82%.