RCL closes within previous day's range
Royal Caribbean Cruises Ltd. (RCL) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
RCL finished Wednesday at 69.61 gaining $1.92 (2.84%), notably outperforming the S&P 500 (-0.46%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (RCL as at Sep 16, 2020):
Wednesday's trading range has been $4.25 (6.28%), that's above the last trading month's daily average range of $3.40. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for RCL. Prices continued to consolidate within a tight trading range between 66.94 and 71.25 where it has been caught now for the last three trading days.
After trading down to 67.00 earlier during the day, the market bounced off the key technical support level at 67.61 (S1). The failure to close below the support could increase that levels significance as support going forward. Prices are trading close to the key technical resistance level at 71.55 (R1). The share ran into sellers again today around 71.25 for the third trading day in a row after having found sellers at 70.84 in the previous session and at 71.18 two days ago.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Selling might accelerate should prices move below the close-by swing low at 66.94 where further sell stops could get triggered. As prices are trading close to September's high at 74.44, upside momentum might speed up should Royal Caribbean mark new highs for the month. As prices are trading close to September's low at 65.67, downside momentum could accelerate should the stock mark new lows for the month.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to prior two Highs" stand out. Though it is usually interpreted as bearish, it has actually shown to be bullish for Royal Caribbean. Out of 107 times, RCL closed higher 58.88% 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 two trading days, showing a win rate of 60.75% with an average market move of 0.06%.