HBI closes below its opening price unable to hold early session gains
Hanesbrands Inc. (HBI) Technical Analysis Report for Jun 22, 2020 | by Techniquant Editorial Team
Moving lower for the 4th day in a row, HBI finished Monday at 11.23 losing $0.12 (-1.06%), significantly underperforming the S&P 500 (0.65%). Trading $0.16 higher after the open, Hanesbrands was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on June 11th, HBI actually gained 4.64% on the following trading day. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (HBI as at Jun 22, 2020):
Monday's trading range has been $0.34 (3.02%), that's far below the last trading month's daily average range of $0.66. 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 HBI.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
After trading down to 11.07 earlier during the day, the market bounced off the key technical support level at 11.09 (S1). The failure to close below the support might increase that levels significance as support going forward.
The stock shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Selling could speed up should prices move below the close-by swing low at 11.03 where further sell stops might get triggered.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "4 Consecutive Lower Closes" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Hanesbrands. Out of 66 times, HBI closed higher 63.64% 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 63.64% with an average market move of 1.74%.