SIG closes lower for the 2nd day in a row
Signet Jewelers Limited (SIG) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, SIG finished the month 4.58% higher at 10.74 after losing $0.47 (-4.19%) today, significantly underperforming the S&P 500 (0.77%). Closing below Thursday's low at 11.05, Signet Jewelers confirmed its breakout through the previous session low after trading up to $0.56 below it intraday.
Daily Candlestick Chart (SIG as at Jul 31, 2020):
Friday's trading range has been $0.86 (7.77%), that's above the last trading month's daily average range of $0.73. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for SIG.
Prices broke below the key technical support level at 10.83 (now R1), which is likely to act as resistance going forward. The last time this happened on July 24th, SIG lost -2.37% on the following trading day.
The share shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Further selling might move prices lower should the market test June's nearby low at 9.71.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Signet Jewelers. Out of 303 times, SIG closed higher 51.16% 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 52.81% with an average market move of 0.58%.