MPLX still stuck within tight trading range
MPLX LP Representing Limited Partner Interests (MPLX) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
MPLX finished the week 8.65% higher at 19.72 after edging higher $0.03 (0.15%) today on low volume, slightly underperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Trading up to $0.54 lower after the open, the stock managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on Tuesday, MPLX gained 3.41% on the following trading day. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (MPLX as at May 22, 2020):
Friday's trading range has been $0.77 (3.94%), that's below the last trading month's daily average range of $1.07. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for MPLX. Prices continued to consolidate within a tight trading range between 18.75 and 20.42 where it has been caught now for the whole last trading week.
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying might speed up should prices move above the nearby swing high at 20.42 where further buy stops could get triggered. Selling might accelerate should prices move below the close-by swing low at 18.75 where further sell stops could get activated. Trading close to March's high at 20.65 we might see further upside momentum if potential buy stops at the level get triggered.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. Though it is usually interpreted as neutral, it has actually shown to be bullish for MPLX LP. Out of 566 times, MPLX closed higher 51.24% 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 54.59% with an average market move of 1.26%.