ORLY finds buyers again around 471.25
O'Reilly Automotive Inc. (ORLY) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
ORLY ended the month 13.21% higher at 477.38 after losing $3.14 (-0.65%) today, strongly underperforming the Nasdaq 100 (1.78%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (ORLY as at Jul 31, 2020):
Friday's trading range has been $9.87 (2.06%), that's slightly above the last trading month's daily average range of $9.76. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently notably higher than usual for ORLY.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Hanging Man.
After having been unable to move lower than 470.30 in the prior session, the market found buyers again around the same price level today at 471.25. The last time this happened on Wednesday, ORLY gained 5.43% on the following trading day.
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 although could signal a potential change in momentum that might lead to a correction back down towards the center of the Bollinger Bands at 439.62.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying could accelerate should prices move above the nearby swing high at 487.95 where further buy stops might get activated.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Hanging Man" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for O'Reilly Automotive. Out of 83 times, ORLY closed higher 51.81% 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 62.65% with an average market move of 1.07%.