SWKS dominated by bears dragging the market lower throughout the day
Skyworks Solutions Inc. (SWKS) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
SWKS finished Wednesday at 140.34 losing $0.57 (-0.4%), but still strongly outperforming the Nasdaq 100 (-1.67%). The bears were in full control today, moving the market lower throughout the whole session. 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 (SWKS as at Sep 16, 2020):
Wednesday's trading range has been $2.56 (1.8%), that's below the last trading month's daily average range of $4.20. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for SWKS.
Two candlestick patterns are matching today's price action, the Bearish Short Candle and the Black Candle which are both known as bearish patterns.
Prices are trading close to the key technical support level at 138.70 (S1). After having been unable to move above 142.76 in the previous session, the market ran into sellers again around the same price level today, failing to move higher than 142.81. The last time this happened on Monday, SWKS actually gained 2.26% on the following trading day.
Although Skyworks Solutions is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Close near low of period" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Skyworks Solutions. Out of 515 times, SWKS closed higher 57.48% 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 58.64% with an average market move of 1.39%.