RL closes within previous day's range
Ralph Lauren Corporation (RL) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, RL ended the week 1.06% higher at 121.84 after losing $1.14 (-0.93%) today, significantly underperforming the S&P 500 (0.18%) ahead of tomorrow's Presidents' Day market holiday. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (RL as at Feb 14, 2020):
Friday's trading range has been $2.38 (1.94%), that's slightly below the last trading month's daily average range of $3.10. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for RL. Prices continued to consolidate within a tight trading range between 119.45 and 124.18 where it has been caught now for the whole last trading week.
After trading down to 120.36 earlier during the day, the stock bounced off the key technical support level at 121.21 (S1). The failure to close below the support could increase that levels significance as support going forward. After having been unable to move lower than 120.61 in the previous session, the market found buyers again around the same price level today at 120.36. The last time this happened on Tuesday, RL gained 2.76% on the following trading day.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might accelerate should prices move above the close-by swing high at 124.18 where further buy stops could get triggered. Selling might speed up should prices move below the nearby swing low at 119.45 where further sell stops could get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for Ralph Lauren. Out of 407 times, RL closed higher 56.51% 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 53.56% with an average market move of 0.56%.