TWTR closes above its opening price after recovering from early selling pressure
Twitter Inc. (TWTR) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, TWTR finished Thursday at 26.41 gaining $0.44 (1.69%) on low volume, notably underperforming the S&P 500 (6.24%). Trading up to $0.53 lower after the open, the stock managed to reverse during the session as bulls took control ending the day above its opening price. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (TWTR as at Mar 26, 2020):
Thursday's trading range has been $1.41 (5.39%), that's far below the last trading month's daily average range of $2.55. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly higher than usual for TWTR. Prices continued to consolidate within a tight trading range between 23.50 and 27.46 where it has been caught now for the whole last trading week.
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 Bullish Spinning Top. The last time a Bullish Spinning Top showed up on March 10th, TWTR actually lost -8.77% on the following trading day.
After trading down to 25.62 earlier during the day, the market bounced off the key technical support level at 25.86 (S1). The failure to close below the support might increase that levels significance as support going forward.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying could accelerate should prices move above the close-by swing high at 27.46 where further buy stops might get activated.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Bullish Intraday Reversal" stand out. Although it is usually interpreted as bullish, it has actually shown to be bearish for Twitter. Out of 246 times, TWTR closed lower 56.10% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after eight trading days, showing a win rate of 51.63% with an average market move of -0.38%.