RDN closes lower for the 2nd day in a row
Radian Group Inc. (RDN) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, RDN ended the week 8.91% higher at 15.16 after losing $0.42 (-2.7%) today, significantly underperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Closing below Thursday's low at 15.45, the market confirmed its breakout through the prior session low after trading up to $0.72 below it intraday.
Daily Candlestick Chart (RDN as at May 22, 2020):
Friday's trading range has been $0.85 (5.47%), that's slightly below the last trading month's daily average range of $0.98. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for RDN.
One bullish candlestick pattern matches today's price action, the Bullish Hikkake Pattern. The last time a Bullish Hikkake Pattern showed up on April 15th, RDN actually lost -3.91% on the following trading day.
Although the share is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could accelerate should prices move above the nearby swing high at 16.12 where further buy stops might get activated. Selling could speed up should prices move below the close-by swing low at 14.16 where further sell stops might get triggered. Further buying could move prices higher should the market test April's nearby high at 16.26.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Hikkake Pattern" stand out. Though it is usually interpreted as bullish, it has actually shown to be bearish for Radian Group. Out of 94 times, RDN closed lower 59.57% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 56.38% with an average market move of -0.16%.