ULTA pushes through Thursday's high
Ulta Salon Cosmetics & Fragrance Inc (ULTA) Technical Analysis Report for Oct 12, 2018
ULTA finished the week 2.15% higher at 275.64 after surging $8.07 (3.02%) today, slightly outperforming the Nasdaq 100 (2.77%). This is the biggest single-day gain in over a month. Closing above Thursday's high at 274.32, the share confirmed its breakout through the previous session high after trading up to $3.61 above it intraday.
Daily Candlestick Chart (ULTA as at Oct 12, 2018):
Friday's trading range has been $5.85 (2.15%), that's slightly below the last trading month's daily average range of $6.23. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently significantly lower than usual for ULTA.
One bullish candlestick pattern matches today's price action, the White Candle. The last time a White Candle showed up on Monday, ULTA gained 0.80% on the following trading day.
Prices are trading close to the key technical resistance level at 278.00 (R1).
Crossing above the lower Bollinger Band, prices have lost at least some of their downward momentum in the short-term and could now be heading back up towards the mean of the Bollinger Bands at 278.12.
Although Ulta Salon is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Buying could accelerate should prices move above the close-by swing high at 278.00 where further buy stops might get triggered. As prices are trading close to October's high at 285.24, upside momentum could speed up should the stock mark new highs for the month.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close crossed above the lower Bollinger Band" stand out. Its common bullish interpretation has been confirmed for Ulta Salon. Out of 48 times, ULTA closed higher 62.50% 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 62.50% with an average market move of 4.19%.