LEN closes within prior day's range
Lennar Corporation Class A (LEN) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
LEN ended the week 1.97% higher at 70.35 after gaining $0.59 (0.85%) today on low volume, outperforming the S&P 500 (0.18%) ahead of tomorrow's Presidents' Day market holiday. Trading up to $0.70 lower after the open, the stock managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (LEN as at Feb 14, 2020):
Friday's trading range has been $1.32 (1.89%), that's slightly below the last trading month's daily average range of $1.38. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently significantly lower than usual for LEN.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bullish Outside Bar.
Prices are trading close to the key technical resistance level at 71.23 (R1). After having been unable to move above 70.46 in the prior session, the market ran into sellers again around the same price level today, missing to move higher than 70.54. The last time this happened on February 4th, LEN actually gained 3.57% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might speed up should prices move above the nearby swing high at 71.23 where further buy stops could get triggered. Trading close to 2018's high at 72.17 we might see further upside momentum if potential buy stops at the level get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous High" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Lennar. Out of 570 times, LEN closed higher 52.28% 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 55.79% with an average market move of 0.78%.