ET plummets, losing $0.52 (-7.27%) within a single day on high volume
Energy Transfer LP (ET) Technical Analysis Report for Aug 06, 2020 | by Techniquant Editorial Team
ET ended Thursday at 6.63 tanking $0.52 (-7.27%) on high volume, strongly underperforming the S&P 500 (0.64%) following Wednesday's earnings report. This is the biggest single-day loss in over a month.
Daily Candlestick Chart (ET as at Aug 06, 2020):
ET reported earnings of $0.13 per share after Wednesday's market close. With analysts having expected an EPS of $0.25, Energy Transfer LP failed market expectations by -48.0%. The company's last earnings report was released on May 11, 2020, when Energy Transfer LP reported earnings of $0.18 per share failing market expectations by -43.8%.
Thursday's trading range has been $0.38 (5.56%), that's far above the last trading month's daily average range of $0.23. Weekly volatility is also higher, being above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for ET.
One bearish candlestick pattern matches today's price action, the Black Candle.
After trading as low as 6.46 during the day, the market found support at the 20-day moving average at 6.59. The stock closed back below the 100-day moving average at 6.92.
Crossing below the upper Bollinger Band, prices have lost at least some of their upward momentum in the short-term and might now be heading back down towards the mean of the Bollinger Bands at 6.59. The last time this happened on June 8th, ET lost -4.18% on the following trading day.
The share shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
Selling could speed up should prices move below the close-by swing low at 6.43 where further sell stops might get triggered. Further selling could move prices lower should the market test July's nearby low at 6.05.
Among the 11 market conditions that our pattern recognition engine identified today, the statistics for the Stock Earning Report based market condition "Trading Day post weak Earnings Report" stand out. Although it is usually interpreted as neutral, it has actually shown to be bearish for Energy Transfer. Out of 4 times, ET closed lower 100.00% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 75.00% with an average market move of -1.81%.