STOR still stuck within tight trading range
STORE Capital Corporation (STOR) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
STOR ended the week 9.15% higher at 18.72 after edging lower $0.09 (-0.48%) today, underperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (STOR as at May 22, 2020):
Friday's trading range has been $0.53 (2.82%), that's far below the last trading month's daily average range of $1.01. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for STOR. Prices continued to consolidate within a tight trading range between 17.85 and 19.03 where it has been caught now for the whole last trading week.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Hanging Man. The last time a Hanging Man showed up on April 30th, STOR lost -4.33% on the following trading day.
The share closed back below the 20-day moving average at 18.73. STORE Capital ran into sellers again today around 18.84 for the third trading day in a row after having found sellers at 18.92 in the prior session and at 18.95 two days ago.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying could speed up should prices move above the close-by swing high at 19.03 where further buy stops might get triggered. Selling could accelerate should prices move below the nearby swing low at 18.00 where further sell stops might get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous two Highs" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for STORE Capital. Out of 76 times, STOR closed higher 64.47% 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 65.79% with an average market move of 0.90%.