SRE finds support at 20-day moving average
Sempra Energy (SRE) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
SRE finished the month 6.17% higher at 124.46 after gaining $0.71 (0.57%) today on low volume, slightly underperforming the S&P 500 (0.77%). Trading up to $0.95 lower after the open, the share managed to reverse during the session as bulls took control ending the day above its opening price. Closing above Thursday's high at 123.96, the stock confirmed its breakout through the prior session high after trading up to $0.81 above it intraday.
Daily Candlestick Chart (SRE as at Jul 31, 2020):
Friday's trading range has been $2.30 (1.86%), that's slightly below the last trading month's daily average range of $2.47. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for SRE. Prices continued to consolidate within a tight trading range between 122.16 and 125.94 where it has been caught now for the whole last trading week.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bullish Outside Bar. In spite of a weak opening Sempra Energy managed to close above the previous day's open and close, forming a bullish Engulfing Candle.
After trading as low as 122.47 during the day, the market found support at the 20-day moving average at 122.66. The last time this happened on April 21st, SRE gained 3.68% on the following trading day. Prices are trading close to the key technical resistance level at 125.59 (R1). After having been unable to move lower than 122.70 in the prior session, SRE found buyers again around the same price level today at 122.47.
The share shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying could speed up should prices move above the close-by swing high at 125.94 where further buy stops might get triggered. Selling could accelerate should prices move below the nearby swing low at 122.16 where further sell stops might get activated.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Engulfing Candle" stand out. Its common bullish interpretation has been confirmed for Sempra Energy. Out of 71 times, SRE closed higher 61.97% 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 63.38% with an average market move of 0.78%.