MU breaks above 20-day moving average for the first time since February 20th
Micron Technology Inc. (MU) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
MU ended Thursday at 44.79 gaining $2.29 (5.39%) on high volume, slightly underperforming the Nasdaq 100 (5.72%) following Wednesday's earnings report. Trading $0.85 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on March 16th, MU actually gained 8.44% on the following trading day. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (MU as at Mar 26, 2020):
MU reported earnings of $0.45 per share after Wednesday's market close. With analysts having expected an EPS of $0.38, Micron Technology Inc. surpassed market expectations by 18.4%. The company's last earnings report was released on Dec. 18, 2019, when Micron Technology Inc. reported earnings of $0.48 per share hitting market expectations.
Thursday's trading range has been $2.42 (5.39%), that's far below the last trading month's daily average range of $3.77. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly higher than usual for MU.
Two candlestick patterns are matching today's price action, the Northern Doji which is known as bearish pattern and one neutral pattern, the Doji.
Micron Technology managed to close above the 20-day moving average at 44.33 for the first time since February 20th. Unable to break through the key technical resistance level at 44.92 (R1), the share closed below it after spiking up to 45.75 earlier during the day. The failure to close above the resistance might increase that levels significance going forward.
While the stock is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Stock Earning Report based market condition "Trading Day post strong Earnings Report" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for Micron Technology. Out of 21 times, MU closed higher 57.14% 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 61.90% with an average market move of 2.03%.