MPLX still stuck within tight trading range
MPLX LP Representing Limited Partner Interests (MPLX) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
MPLX finished Wednesday at 17.76 gaining $0.27 (1.54%), notably outperforming the S&P 500 (-0.46%). Trading up to $0.24 lower after the open, MPLX LP managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (MPLX as at Sep 16, 2020):
Wednesday's trading range has been $0.67 (3.79%), that's slightly above the last trading month's daily average range of $0.59. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for MPLX. Prices continued to consolidate within a tight trading range between 17.20 and 18.19 where it has been caught now for the whole last trading week.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, two candlestick patterns are matching today's price action, the Bullish High-Wave Candle and the Bullish Spinning Top which are both known as bullish patterns. The last time a Bullish High-Wave Candle showed up on August 3rd, MPLX gained 3.37% on the following trading day.
Prices are trading close to the key technical support level at 17.31 (S1). Unable to break through the key technical resistance level at 18.07 (R1), the market closed below it after spiking up to 18.10 earlier during the day. The failure to close above the resistance might increase that levels significance going forward. The stock found buyers again today around 17.43 for the third trading day in a row after having found demand at 17.42 in the prior session and at 17.36 two days ago.
Although still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Buying could speed up should prices move above the nearby swing high at 18.19 where further buy stops might get activated. Selling could accelerate should prices move below the close-by swing low at 17.20 where further sell stops might get triggered. As prices are trading close to September's high at 18.23, upside momentum could speed up should the share mark new highs for the month. Trading close to July's low at 16.85 we might see further downside momentum if potential sell stops at the level get activated.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish High-Wave Candle" stand out. Its common bullish interpretation has been confirmed for MPLX LP. Out of 27 times, MPLX closed higher 51.85% 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 59.26% with an average market move of 2.15%.