MED breaks above 20-day moving average for the first time since February 13th
MEDIFAST INC (MED) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
MED ended Thursday at 69.57 gaining $4.39 (6.74%) on low volume, slightly outperforming the S&P 500 (6.24%). Closing above Wednesday's high at 67.49, MEDIFAST INC confirmed its breakout through the prior session high after trading up to $4.01 above it intraday.
Daily Candlestick Chart (MED as at Mar 26, 2020):
Thursday's trading range has been $5.95 (9.06%), that's slightly below the last trading month's daily average range of $6.37. 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 higher than usual for MED.
One bullish candlestick pattern matches today's price action, the White Candle.
The stock managed to close above the 20-day moving average at 68.33 for the first time since February 13th. When this moving average was crossed above the last time on February 13th, MED actually lost -1.56% on the following trading day. Prices are trading close to the key technical resistance level at 71.93 (R1).
Although the share is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bullish Break through SMA 20" stand out. Though it is usually interpreted as bullish, it has actually shown to be bearish for MEDIFAST INC. Out of 145 times, MED closed lower 51.03% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after three trading days, showing a win rate of 55.86% with an average market move of -0.32%.