GME finds buyers again around 5.33
GameStop Corporation (GME) Technical Analysis Report for Jan 13, 2020 | by Techniquant Editorial Team
GME ended Monday at 5.43 flat, underperforming the S&P 500 (0.7%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (GME as at Jan 13, 2020):
Monday's trading range has been $0.28 (5.16%), that's below the last trading month's daily average range of $0.36. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for GME.
Three candlestick patterns are matching today's price action, the Southern Doji which is known as bullish pattern, one bearish pattern, the Gravestone Doji and one neutral pattern, the Doji. The last time a Southern Doji showed up on August 13, 2019, GME actually lost -4.32% on the following trading day.
Prices are trading close to the key technical support level at 5.31 (S1). After having been unable to move lower than 5.38 in the previous session, the stock found buyers again around the same price level today at 5.33.
Although still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Further selling could move prices lower should the market test December's nearby low at 5.18.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Southern Doji" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for GameStop. Out of 48 times, GME closed lower 52.08% 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 56.25% with an average market move of -1.03%.