SRE finds buyers around 117.21 for the third day in a row
Sempra Energy (SRE) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
SRE finished Wednesday at 120.84 surging $3.21 (2.73%) on high volume, significantly outperforming the S&P 500 (-0.46%). This is the biggest single-day gain in over a month. The last time we've seen such an unusually strong single-day gain on August 10th, SRE actually lost -1.84% on the following trading day. The bulls were in full control today, moving the market higher throughout the whole session. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (SRE as at Sep 16, 2020):
Wednesday's trading range has been $4.21 (3.57%), that's far above the last trading month's daily average range of $2.80. Things look different on the weekly timeframe, where the market's trading range of the last week has been 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 116.64 and 121.42 where it has been caught now for the whole last trading week.
One bullish candlestick pattern matches today's price action, the White Candle.
Prices are trading close to the key technical resistance level at 122.27 (R1). Sempra Energy found buyers again today around 117.21 for the third trading day in a row after having found demand at 117.05 in the prior session and at 117.58 two days ago.
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 122.27 where further buy stops might get activated.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous High" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Sempra Energy. Out of 590 times, SRE closed higher 56.61% 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 57.12% with an average market move of 0.46%.