LB dominated by bears dragging the market lower throughout the day
L Brands Inc. (LB) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
LB finished Thursday at 13.14 losing $0.79 (-5.67%), strongly underperforming the S&P 500 (6.24%). The bears were in full control today, moving the market lower throughout the whole session. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (LB as at Mar 26, 2020):
Thursday's trading range has been $1.75 (12.2%), that's slightly below the last trading month's daily average range of $2.07. 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 notably higher than usual for LB.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Despite a strong opening the share closed below the prior day's open and close, forming a bearish Engulfing Candle. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle. The last time a Black Candle showed up on March 20th, LB lost -6.24% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Black Candle" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for L Brands. Out of 559 times, LB closed higher 49.91% 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 seven trading days, showing a win rate of 52.24% with an average market move of -0.16%.