ESNT pushes through Thursday's high
Essent Group Ltd. (ESNT) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, ESNT ended the month -1.21% lower at 35.83 after gaining $0.31 (0.87%) today, slightly outperforming the S&P 500 (0.77%). Closing above Thursday's high at 35.77, Essent Group confirmed its breakout through the prior session high after trading up to $0.12 above it intraday.
Daily Candlestick Chart (ESNT as at Jul 31, 2020):
Friday's trading range has been $0.89 (2.52%), that's below the last trading month's daily average range of $1.33. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for ESNT.
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 Bullish Short Candle showed up on July 10th, ESNT gained 0.34% on the following trading day.
After having been unable to move above 35.77 in the previous session, the stock ran into sellers again around the same price level today, failing to move higher than 35.89.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying might speed up should prices move above the close-by swing high at 36.76 where further buy stops could get activated. Selling might accelerate should prices move below the nearby swing low at 34.14 where further sell stops could get triggered. As prices are trading close to July's high at 36.84, upside momentum might speed up should the market mark new highs for the month.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "RSI(2) above 80" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Essent Group. Out of 192 times, ESNT closed higher 54.69% 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 two trading days, showing a win rate of 55.73% with an average market move of 0.17%.