SDA.AX closes above its opening price after recovering from early selling pressure
Speedcast Int Limited (SDA.AX) Technical Analysis Report for Feb 13, 2019 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, SDA.AX ended Wednesday at 3.17 gaining $0.06 (1.93%), strongly outperforming the ASX 200 (-0.25%). Today's close at 3.17 marks the highest recorded closing price since December 20, 2018. Trading up to $0.09 lower after the open, the share managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (SDA.AX as at Feb 13, 2019):
Wednesday's trading range has been $0.11 (3.49%), that's slightly below the last trading month's daily average range of $0.11. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for SDA.AX.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Hanging Man.
After trading down to 3.06 earlier during the day, the market bounced off the key technical support level at 3.10 (S1). The failure to close below the support could increase that levels significance as support going forward. After having been unable to move above 3.18 in the prior session, the stock ran into sellers again around the same price level today, missing to move higher than 3.17. The last time this happened on February 8th, SDA.AX actually gained 2.73% on the following trading day.
With another close above the upper Bollinger Band, prices are confirming their strong upward momentum in the short-term. A drop back into the Bollinger Band on the next trading day while might signal a potential change in momentum that could lead to a correction back down towards the center of the Bollinger Bands at 2.95.
Although Speedcast Int 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 speed up should prices move above the nearby swing high at 3.18 where further buy stops might get triggered.
Among the nine 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 Speedcast Int. Out of 171 times, SDA.AX closed higher 52.05% 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 52.63% with an average market move of 0.65%.