MU breaks above 200-day moving average for the first time since August 5th
Micron Technology Inc. (MU) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, MU finished Wednesday at 50.21 gaining $1.16 (2.36%) on high volume, strongly outperforming the Nasdaq 100 (-1.67%). Today's close at 50.21 marks the highest recorded closing price since August 5th. Closing above Tuesday's high at 49.66, Micron Technology confirmed its breakout through the prior session high after trading up to $1.56 above it intraday.
Daily Candlestick Chart (MU as at Sep 16, 2020):
Wednesday's trading range has been $2.26 (4.6%), that's far above the last trading month's daily average range of $1.31. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for MU.
The stock managed to close above the 200-day moving average at 49.34 for the first time since August 5th. When this moving average was crossed above the last time on June 29th, MU gained 4.82% on the following trading day. Unable to break through the key technical resistance level at 51.02 (R1), the market closed below it after spiking up to 51.22 earlier during the day. The failure to close above the resistance might increase that levels significance going forward. After having been unable to move lower than 48.70 in the previous session, the share found buyers again around the same price level today at 48.96.
With another close above the upper Bollinger Band, prices are confirming their strong upward momentum in the short-term. A drop back into the Bollinger Band on the next trading day though could signal a potential change in momentum that might lead to a correction back down towards the center of the Bollinger Bands at 45.76.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Further buying could move prices higher should the market test August's close-by high at 51.48.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close above the upper Bollinger Band" stand out. Its common bullish interpretation has been confirmed for Micron Technology. Out of 175 times, MU closed higher 58.86% 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 57.71% with an average market move of 1.15%.