TWTR finds buyers at key support level
Twitter Inc. (TWTR) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, TWTR ended Wednesday at 39.60 gaining $0.51 (1.3%), significantly outperforming the S&P 500 (-0.46%). Ending the day with an indecisive close, neither buyers nor sellers were able to gain control during the session.
Daily Candlestick Chart (TWTR as at Sep 16, 2020):
Wednesday's trading range has been $1.71 (4.34%), that's above the last trading month's daily average range of $1.35. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for TWTR.
After trading down to 39.19 earlier during the day, the share bounced off the key technical support level at 39.32 (S1). The failure to close below the support might increase that levels significance as support going forward. After spiking up to 40.90 during the day, Twitter found resistance at the 20-day moving average at 40.03. The last time this happened on September 9th, TWTR lost -1.54% on the following trading day.
While the stock is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Selling might accelerate should prices move below the close-by swing low at 38.23 where further sell stops could get activated.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Bounce off SMA 20" stand out. Its common bearish interpretation has been confirmed for Twitter. Out of 36 times, TWTR closed lower 66.67% of the time on the next trading day after the market condition occurred.