PEN closes within prior day's range
Penumbra Inc. (PEN) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
PEN finished the month 24.1% higher at 221.91 after losing $2.62 (-1.17%) today on high volume, strongly underperforming the S&P 500 (0.77%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (PEN as at Jul 31, 2020):
Friday's trading range has been $8.23 (3.69%), that's above the last trading month's daily average range of $6.01. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for PEN.
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. The last time a Hanging Man showed up on Tuesday, PEN actually gained 3.76% on the following trading day.
Prices are trading close to the key technical resistance level at 225.64 (R1). After having been unable to move lower than 215.66 in the prior session, the stock found buyers again around the same price level today at 216.19.
Crossing below the upper Bollinger Band, prices have lost at least some of their upward momentum in the short-term and could now be heading back down towards the mean of the Bollinger Bands at 201.36.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might speed up should prices move above the close-by swing high at 225.64 where further buy stops could get activated.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. Though it is usually interpreted as neutral, it has actually shown to be bullish for Penumbra. Out of 353 times, PEN closed higher 54.11% 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 59.49% with an average market move of 1.90%.