MU dominated by bears dragging the market lower throughout the day
Micron Technology Inc. (MU) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
MU ended the week 2.85% higher at 58.50 after losing $0.83 (-1.4%) today, strongly underperforming the Nasdaq 100 (0.29%) ahead of tomorrow's Presidents' Day market holiday. The bears were in full control today, moving the market lower throughout the whole session. Closing below Thursday's low at 58.86, the market confirmed its breakout through the previous session low after trading up to $0.60 below it intraday.
Daily Candlestick Chart (MU as at Feb 14, 2020):
Friday's trading range has been $2.30 (3.82%), that's far above the last trading month's daily average range of $1.73. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for MU.
Notwithstanding a strong opening the share closed below the prior day's open and close, forming a bearish Engulfing Candle. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle.
After trading down to 58.26 earlier during the day, Micron Technology bounced off the key technical support level at 58.48 (S1). The failure to close below the support might increase that levels significance as support going forward. When prices bounced off a significant support level the last time on January 15th, MU gained 2.69% on the following trading day. Unable to break through the key technical resistance level at 60.56 (R1), the stock closed below it after spiking up to 60.56 earlier during the day. The failure to close above the resistance could increase that levels importance going forward. After having been unable to move above 60.63 in the previous session, MU ran into sellers again around the same price level today, failing to move higher than 60.56.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to prior High" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Micron Technology. Out of 538 times, MU closed higher 53.53% 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 57.43% with an average market move of 1.66%.