ICPT unable to break through key resistance level
Intercept Pharmaceuticals Inc. (ICPT) Technical Analysis Report for Jun 29, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, ICPT finished Monday at 46.70 tanking $30.79 (-39.73%) on high volume, notably underperforming the S&P 500 (1.47%). This is the biggest single-day loss in over five years. Today's close at 46.70 marks the lowest recorded closing price since August 30, 2013. Trading $2.75 higher after the open, the share was unable to hold its gains as the bears took control ending the day below its opening price. Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (ICPT as at Jun 29, 2020):
Monday's trading range has been $5.49 (11.62%), that's far above the last trading month's daily average range of $3.81. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently strongly higher than usual for ICPT.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
Unable to break through the key technical resistance level at 49.14 (R1), the market closed below it after spiking up to 50.00 earlier during the day. The failure to close above the resistance could increase that levels significance going forward.
Crossing below the lower Bollinger Band for the first time since March 18th, prices have shown unusually strong downward momentum in the short-term. This might either indicate a potential selling climax after which prices could head back up towards the mean of the Bollinger Bands at 76.55 or signal the beginning of a strong momentum breakout leading to even lower prices. The last time prices broke out below the lower Bollinger Band on March 11th, ICPT lost -14.82% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close crossed below the lower Bollinger Band" stand out. Its common bearish interpretation has been confirmed for Intercept. Out of 43 times, ICPT closed lower 60.47% 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 55.81% with an average market move of -3.16%.