PAYX edges higher $0.52 (0.87%) after posting strong earnings
Paychex Inc. (PAYX) Technical Analysis Report for Mar 25, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, PAYX finished Wednesday at 60.08 edging higher $0.52 (0.87%), notably outperforming the Nasdaq 100 (-1.11%) following today's earnings report. Trading up to $4.63 lower after the open, Paychex managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (PAYX as at Mar 25, 2020):
PAYX reported earnings of $0.97 per share before today's market open. With analysts having expected an EPS of $0.96, Paychex Inc. topped market expectations by 1.0%. The company's last earnings report was released on Dec. 18, 2019, when Paychex Inc. reported earnings of $0.7 per share surpassing market expectations by 1.4%.
Wednesday's trading range has been $11.28 (19.12%), that's far above the last trading month's daily average range of $5.97. Weekly volatility is also higher, being above the market's average weekly trading range. The longer-term, monthly volatility is currently significantly higher than usual for PAYX.
Two candlestick patterns are matching today's price action, the Bullish High-Wave Candle and the Bullish Spinning Top which are both known as bullish patterns.
Unable to break through the key technical resistance level at 64.61 (R1), the market closed below it after spiking up to 65.65 earlier during the day. The failure to close above the resistance might increase that levels significance going forward. When prices bounced off a significant resistance level the last time on March 11th, PAYX lost -11.01% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Higher Closes" stand out. Its common bullish interpretation has been confirmed for Paychex. Out of 331 times, PAYX closed higher 54.08% 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 60.12% with an average market move of 0.37%.