SIMO closes within prior day's range after lackluster session
Silicon Motion Technology Corporation (SIMO) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
SIMO ended the month -15.17% lower at 41.37 after gaining $0.70 (1.72%) today, outperforming the S&P 500 (0.77%). Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (SIMO as at Jul 31, 2020):
Friday's trading range has been $0.96 (2.34%), that's below the last trading month's daily average range of $1.50. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for SIMO. Prices continued to consolidate within a tight trading range between 39.63 and 41.86 where it has been caught now for the whole last trading week.
Unable to break through the key technical resistance level at 41.45 (R1), the market closed below it after spiking up to 41.83 earlier during the day. The failure to close above the resistance could increase that levels importance going forward.
Though still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Buying might accelerate should prices move above the nearby swing high at 41.86 where further buy stops could get activated. Selling might speed up should prices move below the close-by swing low at 39.78 where further sell stops could get triggered.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. While it is usually interpreted as neutral, it has actually shown to be bullish for Silicon Motion. Out of 758 times, SIMO closed higher 53.17% 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 56.20% with an average market move of 1.11%.