LHCG dominated by bears dragging the market lower throughout the day
LHC Group (LHCG) Technical Analysis Report for Jul 13, 2020 | by Techniquant Editorial Team
LHCG finished Monday at 174.26 tanking $7.06 (-3.89%), significantly underperforming the S&P 500 (-0.94%). This is the biggest single-day loss in over a month. The bears were in full control today, moving the market lower throughout the whole session. Closing below Friday's low at 178.15, LHC Group confirmed its breakout through the previous session low after trading up to $4.48 below it intraday.
Daily Candlestick Chart (LHCG as at Jul 13, 2020):
Monday's trading range has been $11.30 (6.18%), that's far above the last trading month's daily average range of $5.88. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for LHCG.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar. Notwithstanding a strong opening the market 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.
Prices broke below the key technical support level at 174.45 (now R1), which is likely to act as resistance going forward. The last time this happened on June 17th, LHCG actually gained 3.19% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
As prices are trading close to July's low at 172.55, downside momentum might accelerate should the stock mark new lows for the month.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Strong Down Move" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for LHC Group. Out of 177 times, LHCG closed higher 55.37% 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 59.32% with an average market move of 1.92%.