GTT breaks back below 20-day moving average
GTT Communications Inc. (GTT) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
GTT finished the month 2.13% higher at 8.16 after losing $0.10 (-1.21%) today on low volume, significantly underperforming the S&P 500 (1.54%). Trading up to $0.18 lower after the open, the share managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on June 24th, GTT gained 4.33% on the following trading day. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (GTT as at Jun 30, 2020):
Tuesday's trading range has been $0.32 (3.94%), that's below the last trading month's daily average range of $0.59. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for GTT.
One bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
The market closed back below the 20-day moving average at 8.22. After having been unable to move lower than 7.96 in the previous session, GTT Communications found buyers again around the same price level today at 7.94.
Although the stock is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Buying might accelerate should prices move above the nearby swing high at 8.38 where further buy stops could get activated. Selling might speed up should prices move below the close-by swing low at 7.52 where further sell stops could get triggered. Trading close to April's low at 6.99 we might see further downside momentum if potential sell stops at the level get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Break through SMA 20" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for GTT Communications. Out of 125 times, GTT closed higher 56.00% 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 59.20% with an average market move of 2.67%.