NTES closes within prior day's range after lackluster session
NetEase Inc. (NTES) Technical Analysis Report for Jul 16, 2019 | by Techniquant Editorial Team
NTES ended Tuesday at 259.38 gaining $3.14 (1.23%) on low volume, significantly outperforming the Nasdaq 100 (-0.5%). Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (NTES as at Jul 16, 2019):
Tuesday's trading range has been $4.20 (1.63%), that's below the last trading month's daily average range of $5.72. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for NTES.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. After moving lower in the previous session, the market managed to close higher but below the prior day's open, forming a bullish Harami Candle. Additionally, two candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns. The last time a Bullish Short Candle showed up on April 4th, NTES gained 3.68% on the following trading day.
After having been unable to move lower than 256.08 in the previous session, NetEase found buyers again around the same price level today at 256.47.
Although still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Selling might accelerate should prices move below the nearby swing low at 256.08 where further sell stops could get triggered.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Harami Candle" stand out. Its common bullish interpretation has been confirmed for NetEase. Out of 48 times, NTES closed higher 54.17% 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 58.33% with an average market move of 2.29%.