STM closes higher for the 6th day in a row
STMicroelectronics N.V. (STM) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 6th day in a row, STM ended Thursday at 21.44 gaining $0.57 (2.73%) on low volume, significantly underperforming the S&P 500 (6.24%). Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (STM as at Mar 26, 2020):
Thursday's trading range has been $1.27 (6.14%), that's slightly below the last trading month's daily average range of $1.69. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently notably higher than usual for STM.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, one bullish candlestick pattern matches today's price action, the White Candle.
Prices are trading close to the key technical resistance level at 22.35 (R1). After having been unable to move lower than 20.00 in the previous session, STMicroelectronics N. V. found buyers again around the same price level today at 20.27. The last time this happened on Monday, STM gained 12.97% on the following trading day.
Though the market 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 close-by swing high at 21.62 where further buy stops might get triggered.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "White Candle" stand out. Its common bullish interpretation has been confirmed for STMicroelectronics N. V.. Out of 613 times, STM closed higher 51.55% 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 56.28% with an average market move of 0.98%.