M closes above its opening price after recovering from early selling pressure
Macy's Inc (M) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
M ended Wednesday at 6.98 gaining $0.11 (1.6%), strongly outperforming the S&P 500 (-0.46%). Trading up to $0.15 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 failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (M as at Sep 16, 2020):
Wednesday's trading range has been $0.39 (5.65%), that's slightly below the last trading month's daily average range of $0.42. 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 slightly lower than usual for M.
After moving lower in the prior session, the share managed to close higher but below the previous day's open, forming a bullish Harami Candle. Additionally, one bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
The market managed to close back above the 20-day moving average at 6.96. When this moving average was crossed above the last time on August 27th, M gained 4.98% on the following trading day.
Though Macy's is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Buying could speed up should prices move above the nearby swing high at 7.31 where further buy stops might get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Harami Candle" stand out. Its common bullish interpretation has been confirmed for Macy's. Out of 61 times, M closed higher 60.66% 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 six trading days, showing a win rate of 54.10% with an average market move of -0.49%.