NTES closes above its opening price after recovering from early selling pressure
NetEase Inc. (NTES) Technical Analysis Report for Jul 30, 2020 | by Techniquant Editorial Team
NTES ended Thursday at 451.22 losing $1.18 (-0.26%), underperforming the Nasdaq 100 (0.49%). Trading up to $3.05 lower after the open, the share managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on Monday, NTES actually lost -0.36% on the following trading day. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (NTES as at Jul 30, 2020):
Thursday's trading range has been $6.63 (1.47%), that's far below the last trading month's daily average range of $12.83. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for NTES. Prices continued to consolidate within a tight trading range between 444.10 and 457.85 where it has been caught now for the last three trading days.
Two candlestick patterns are matching today's price action, the Southern Doji which is known as bullish pattern and one neutral pattern, the Doji.
Prices are trading close to the key technical resistance level at 457.85 (R1). After having been unable to move lower than 449.36 in the previous session, the market found buyers again around the same price level today at 448.03.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could accelerate should prices move above the close-by swing high at 457.85 where further buy stops might get activated. Selling could speed up should prices move below the nearby swing low at 444.10 where further sell stops might get triggered.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Doji" stand out. Though it is usually interpreted as neutral, it has actually shown to be bullish for NetEase. Out of 145 times, NTES closed higher 55.17% 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 56.55% with an average market move of 1.44%.