MELI closes within previous day's range
MercadoLibre Inc. (MELI) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, MELI finished the month 14.09% higher at 1124.62 after gaining $17.12 (1.55%) today on high volume, slightly underperforming the Nasdaq 100 (1.78%). Today's close at 1124.62 marks the highest recorded closing price ever. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (MELI as at Jul 31, 2020):
Friday's trading range has been $65.67 (5.72%), that's above the last trading month's daily average range of $48.83. Weekly volatility is also higher, being above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for MELI.
Prices are trading close to the key technical resistance level at 1125.00 (R1).
With another close above the upper Bollinger Band, prices are confirming their strong upward momentum in the short-term. A drop back into the Bollinger Band on the next trading day though might signal a potential change in momentum that could lead to a correction back down towards the center of the Bollinger Bands at 1019.12.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close above the upper Bollinger Band" stand out. Its common bullish interpretation has been confirmed for MercadoLibre. Out of 192 times, MELI closed higher 52.60% 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 52.08% with an average market move of 0.65%.