PDCO closes higher for the 3rd day in a row
Patterson Companies Inc. (PDCO) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, PDCO ended the week 16.94% higher at 17.40 after gaining $0.08 (0.46%) today on low volume, slightly outperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Today's close at 17.40 marks the highest recorded closing price since April 30th. Trading up to $0.35 lower after the open, the share 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 (PDCO as at May 22, 2020):
Friday's trading range has been $0.99 (5.72%), that's slightly above the last trading month's daily average range of $0.88. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for PDCO.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bullish Outside Bar. Additionally, 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. The last time a Bullish High-Wave Candle showed up on March 17th, PDCO actually lost -19.12% on the following trading day.
Prices are trading close to the key technical resistance level at 18.04 (R1).
Although the stock is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Further buying could move prices higher should the market test April's close-by high at 18.54.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Outside Bar" stand out. Its common bullish interpretation has been confirmed for Patterson Companies. Out of 119 times, PDCO closed higher 63.87% 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 60.50% with an average market move of 0.60%.