MLCO closes below its opening price unable to hold early session gains
Melco Resorts & Entertainment Limited (MLCO) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
MLCO ended Thursday at 13.44 losing $1.00 (-6.93%) on high volume, notably underperforming the S&P 500 (6.24%). Trading $1.30 higher after the open, Melco Resorts was unable to hold its gains as the bears took control ending the day below its opening price. Closing below Wednesday's low at 13.48, the market confirmed its breakout through the previous session low after trading up to $0.53 below it intraday.
Daily Candlestick Chart (MLCO as at Mar 26, 2020):
Thursday's trading range has been $2.60 (18.25%), that's far above the last trading month's daily average range of $1.37. Weekly volatility is also higher, being above the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for MLCO.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bearish Outside Bar.
After spiking up to 15.55 during the day, the stock found resistance at the 20-day moving average at 15.06. The last time this happened on February 11th, MLCO actually gained 5.67% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Bearish Intraday Reversal" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Melco Resorts. Out of 387 times, MLCO closed higher 52.45% 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 55.81% with an average market move of 1.51%.