PAYX closes lower for the 2nd day in a row
Paychex Inc. (PAYX) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, PAYX finished the month -5.06% lower at 71.92 after losing $0.43 (-0.59%) today on high volume, strongly underperforming the Nasdaq 100 (1.78%). Trading up to $1.18 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on Wednesday, PAYX actually lost -1.63% on the following trading day. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (PAYX as at Jul 31, 2020):
Friday's trading range has been $1.55 (2.17%), that's slightly below the last trading month's daily average range of $1.60. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for PAYX.
One bullish candlestick pattern matches today's price action, the Takuri Line.
Prices are trading close to the key technical resistance level at 72.01 (R1).
The share shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying could accelerate should prices move above the nearby swing high at 73.60 where further buy stops might get triggered. As prices are trading close to July's low at 69.96, downside momentum could speed up should Paychex mark new lows for the month.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "RSI(2) below 20" stand out. Its common bullish interpretation has been confirmed for Paychex. Out of 244 times, PAYX closed higher 60.25% 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 60.66% with an average market move of 0.75%.