PHM dominated by bears dragging the market lower throughout the day
PulteGroup Inc. (PHM) Technical Analysis Report for Oct 12, 2018 | by Techniquant Editorial Team
Moving lower for the 4th day in a row, PHM ended the week -4.07% lower at 22.89 after losing $0.42 (-1.8%) today, notably underperforming the S&P 500 (1.42%). Today's close at 22.89 marks the lowest recorded closing price since May 31, 2017. The bears were in full control today, moving the market lower throughout the whole session. Closing below Thursday's low at 23.25, Pulte Homes confirmed its breakout through the previous session low after trading up to $0.58 below it intraday.
Daily Candlestick Chart (PHM as at Oct 12, 2018):
Friday's trading range has been $1.00 (4.22%), that's far above the last trading month's daily average range of $0.67. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for PHM.
Two candlestick patterns are matching today's price action, the Last Engulfing Bottom Pattern which is known as bullish pattern and one bearish pattern, the Black Candle. The last time a Last Engulfing Bottom Pattern showed up on October 3rd, PHM actually lost -1.25% on the following trading day.
Prices broke below the key technical support level at 23.18 (now R1), which is likely to act as resistance going forward.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Last Engulfing Bottom Pattern" stand out. Its common bullish interpretation has been confirmed for Pulte Homes. Out of 60 times, PHM closed higher 56.67% 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 51.67% with an average market move of 0.50%.