HA finds buyers at key support level
Hawaiian Holdings Inc. (HA) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
HA ended the month -15.31% lower at 11.89 after gaining $0.27 (2.32%) today, notably outperforming the S&P 500 (0.77%). Trading up to $0.22 lower after the open, the share managed to reverse during the session as bulls took control ending the day above its opening price. 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 (HA as at Jul 31, 2020):
Friday's trading range has been $0.54 (4.6%), that's below the last trading month's daily average range of $0.75. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for HA.
After moving lower in the previous session, the market managed to close higher but below the prior day's open, forming a bullish Harami Candle. Additionally, one bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
After trading down to 11.53 earlier during the day, Hawaiian Holdings bounced off the key technical support level at 11.74 (S1). The failure to close below the support could increase that levels significance as support going forward. After having been unable to move lower than 11.50 in the previous session, the stock found buyers again around the same price level today at 11.53. The last time this happened on Tuesday, HA actually lost -7.82% on the following trading day.
Crossing above the lower Bollinger Band, prices have lost at least some of their downward momentum in the short-term and might now be heading back up towards the mean of the Bollinger Bands at 13.26.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Selling could accelerate should prices move below the nearby swing low at 11.50 where further sell stops might get triggered. Trading close to May's low at 10.31 we could see further downside momentum if potential sell stops at the level get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Harami Candle" stand out. Although it is usually interpreted as bullish, it has actually shown to be bearish for Hawaiian Holdings. Out of 72 times, HA closed lower 51.39% 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 61.11% with an average market move of -1.09%.