LW runs into sellers again around 67.01
Lamb Weston Holdings Inc. (LW) Technical Analysis Report for Jul 16, 2019 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, LW ended Tuesday at 66.79 gaining $0.42 (0.63%), outperforming the S&P 500 (-0.34%). Trading up to $0.28 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 failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (LW as at Jul 16, 2019):
Tuesday's trading range has been $0.66 (0.99%), that's far below the last trading month's daily average range of $1.44. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently significantly higher than usual for LW.
One bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
Prices are trading close to the key technical support level at 65.95 (S1). After having been unable to move above 66.81 in the previous session, the stock ran into sellers again around the same price level today, missing to move higher than 67.01. The last time this happened on July 12th, LW actually gained 0.67% on the following trading day.
While Lamb Weston is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could speed up should prices move above the close-by swing high at 67.76 where further buy stops might get triggered. Selling could accelerate should prices move below the nearby swing low at 65.41 where further sell stops might get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Higher Closes" stand out. Its common bullish interpretation has been confirmed for Lamb Weston. Out of 89 times, LW closed higher 60.67% 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 65.17% with an average market move of 1.46%.