ROKU closes lower for the 2nd day in a row
Roku Inc. (ROKU) Technical Analysis Report for Nov 09, 2018 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, ROKU ended the week -24.1% lower at 43.94 after losing $1.80 (-3.94%) today, strongly underperforming the S&P 500 (-0.92%). Today's close at 43.94 marks the lowest recorded closing price since July 2nd.
Daily Candlestick Chart (ROKU as at Nov 09, 2018):
Friday's trading range has been $2.68 (5.93%), that's far below the last trading month's daily average range of $3.84. Things look different on the weekly timeframe, where the market's trading range of the last week has been way above the market's average weekly trading range. The longer-term, monthly volatility is currently just the same than usual for ROKU.
After trading down to 42.71 earlier during the day, the stock bounced off the key technical support level at 43.41 (S1). The failure to close below the support might increase that levels significance as support going forward. When prices bounced off a significant support level the last time on November 1st, ROKU gained 0.10% on the following trading day.
With another close below the lower Bollinger Band, prices are confirming their strong downward momentum in the short-term. A rally back into the Bollinger Band on the next trading day though could signal a potential change in momentum that might lead to a correction back up towards the center of the Bollinger Bands at 54.75.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close below the lower Bollinger Band" stand out. Its common bearish interpretation has been confirmed for Roku. Out of 9 times, ROKU closed lower 66.67% 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 66.67% with an average market move of -7.91%.