FLS snaps to lowest close since July 10th
Flowserve Corporation (FLS) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, FLS finished the month -2.28% lower at 27.87 after tanking $2.07 (-6.91%) today on high volume, notably underperforming the S&P 500 (0.77%) following Thursday's earnings report. This is the biggest single-day loss in over a month. The last time we've seen such an unusually strong single-day loss on June 11th, FLS actually gained 3.70% on the following trading day. Today's close at 27.87 marks the lowest recorded closing price since July 10th. Closing below Thursday's low at 29.11, the stock confirmed its breakout through the prior session low after trading up to $2.00 below it intraday.
Daily Candlestick Chart (FLS as at Jul 31, 2020):
FLS reported earnings of $0.53 per share after Thursday's market close. With analysts having expected an EPS of $0.29, Flowserve Corporation topped market expectations by 82.8%. The company's last earnings report was released on May 7, 2020, when Flowserve Corporation reported earnings of $0.21 per share failing market expectations by -48.8%.
Friday's trading range has been $2.96 (9.94%), that's far above the last trading month's daily average range of $1.12. 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 FLS.
One bearish candlestick pattern matches today's price action, the Black Candle.
The share closed below the 50-day moving average at 28.60 for the first time since July 9th. After having been unable to move above 30.10 in the previous session, the market ran into sellers again around the same price level today, missing to move higher than 30.07.
Flowserve shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Further selling could move prices lower should the market test June's nearby low at 25.53.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Price broke through Technical Support S1" stand out. Its common bearish interpretation has been confirmed for Flowserve. Out of 237 times, FLS closed lower 55.27% 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 four trading days, showing a win rate of 54.01% with an average market move of 0.17%.