UNH breaks back above 20-day moving average
UnitedHealth Group Incorporated (UNH) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
UNH ended the week -0.35% lower at 289.94 after gaining $3.03 (1.06%) today, notably outperforming the Dow Indu. (-0.04%) ahead of tomorrow's Memorial Day market holiday. Trading up to $2.51 lower after the open, the stock managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on May 4th, UNH gained 1.91% on the following trading day. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (UNH as at May 22, 2020):
Friday's trading range has been $5.43 (1.89%), that's below the last trading month's daily average range of $7.89. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly lower than usual for UNH. Prices continued to consolidate within a tight trading range between 284.79 and 292.90 where it has been caught now for the last three trading days.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bullish Outside Bar.
United Health managed to close back above the 20-day moving average at 288.58. After having been unable to move lower than 284.93 in the previous session, the share found buyers again around the same price level today at 284.79.
Though still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying might speed up should prices move above the close-by swing high at 300.00 where further buy stops could get activated. With prices trading close to this year's high at 306.71, upside momentum might accelerate should UnitedHealth Group be able to break out to new highs for the year. Further buying could move prices higher should the market test April's nearby high at 304.00.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Outside Bar" stand out. Its common bullish interpretation has been confirmed for UnitedHealth Group. Out of 113 times, UNH closed higher 53.98% 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 64.60% with an average market move of 1.06%.