ULTA closes within prior day's range
Ulta Beauty Inc. (ULTA) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
ULTA ended the week 10.06% higher at 220.62 after losing $2.14 (-0.96%) today, notably underperforming the Nasdaq 100 (0.38%) ahead of tomorrow's Memorial Day market holiday. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (ULTA as at May 22, 2020):
Friday's trading range has been $7.26 (3.25%), that's slightly below the last trading month's daily average range of $9.07. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for ULTA.
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.
Prices are trading close to the key technical resistance level at 224.48 (R1). After having been unable to move above 224.48 in the previous session, the market ran into sellers again around the same price level today, failing to move higher than 223.64. The last time this happened on May 6th, ULTA actually gained 1.78% on the following trading day.
The share shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying could speed up should prices move above the close-by swing high at 224.48 where further buy stops might get triggered. As prices are trading close to May's high at 234.60, upside momentum could accelerate should Ulta Beauty mark new highs for the month.
Among the two market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. While it is usually interpreted as neutral, it has actually shown to be bullish for Ulta Beauty. Out of 809 times, ULTA closed higher 51.79% 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 62.30% with an average market move of 1.44%.