LUV slides to lowest close since May 22nd
Southwest Airlines Company (LUV) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, LUV ended the month -9.63% lower at 30.89 after edging lower $0.07 (-0.23%) today, underperforming the S&P 500 (0.77%). Today's close at 30.89 marks the lowest recorded closing price since May 22nd. Trading up to $0.56 lower after the open, the share managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (LUV as at Jul 31, 2020):
Friday's trading range has been $0.78 (2.53%), that's below the last trading month's daily average range of $1.25. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for LUV.
Two candlestick patterns are matching today's price action, the Bullish Spinning Top and the Takuri Line which are both known as bullish patterns. The last time a Takuri Line showed up on June 23rd, LUV actually lost -7.19% on the following trading day.
Prices are trading close to the key technical resistance level at 31.40 (R1).
Southwest Airlines shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Bullish Intraday Reversal" stand out. Its common bullish interpretation has been confirmed for Southwest Airlines. Out of 434 times, LUV closed higher 51.61% 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 55.76% with an average market move of 0.31%.