ULTA runs into sellers again around 201.75
Ulta Beauty Inc. (ULTA) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
ULTA ended Thursday at 188.83 losing $3.05 (-1.59%), notably underperforming the Nasdaq 100 (5.72%). Trading $6.88 higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on Monday, ULTA actually gained 23.98% on the following trading day. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (ULTA as at Mar 26, 2020):
Thursday's trading range has been $17.19 (8.82%), that's slightly below the last trading month's daily average range of $19.18. 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 strongly higher than usual for ULTA.
Prices broke below the key technical support level at 190.83 (now R1), which is likely to act as resistance going forward. After having been unable to move above 201.30 in the previous session, Ulta Beauty ran into sellers again around the same price level today, missing to move higher than 201.75.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Price broke through Technical Support S1" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Ulta Beauty. Out of 229 times, ULTA closed higher 53.71% 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 58.95% with an average market move of 0.90%.