JEF still stuck within tight trading range
Jefferies Financial Group Inc. (JEF) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
JEF ended the week 6.08% higher at 13.25 after edging higher $0.08 (0.61%) today on low volume, slightly outperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Trading up to $0.31 lower after the open, Jefferies Financial managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on Monday, JEF actually lost -2.83% on the following trading day. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (JEF as at May 22, 2020):
Friday's trading range has been $0.42 (3.19%), that's below the last trading month's daily average range of $0.60. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for JEF. Prices continued to consolidate within a tight trading range between 12.86 and 13.55 where it has been caught now for the whole last trading week.
Three candlestick patterns are matching today's price action, the Bullish Hikkake Pattern which is known as bullish pattern and two bearish patterns, the Hanging Man and the Last Engulfing Top Pattern.
Prices are trading close to the key technical resistance level at 13.36 (R1).
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying could accelerate should prices move above the nearby swing high at 13.55 where further buy stops might get activated. As prices are trading close to May's high at 14.17, upside momentum could speed up should the share mark new highs for the month.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Last Engulfing Top Pattern" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Jefferies Financial. Out of 57 times, JEF closed higher 50.88% 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 61.40% with an average market move of 1.16%.