VNE closes within previous day's range after lackluster session
Veoneer Inc. (VNE) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
VNE finished the week 8.78% higher at 9.66 after gaining $0.11 (1.15%) today, outperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Trading up to $0.25 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 11th, VNE actually lost -9.22% on the following trading day. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (VNE as at May 22, 2020):
Friday's trading range has been $0.38 (3.95%), that's below the last trading month's daily average range of $0.51. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for VNE. Prices continued to consolidate within a tight trading range between 9.37 and 10.01 where it has been caught now for the whole last trading week.
Two candlestick patterns are matching today's price action, the Bullish Hikkake Pattern and the Bullish Spinning Top which are both known as bullish patterns.
The market managed to close back above the 20-day moving average at 9.63.
Veoneer shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Buying could accelerate should prices move above the close-by swing high at 10.01 where further buy stops might get triggered. Further buying could move prices higher should the market test April's nearby high at 10.59.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Hikkake Pattern" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for Veoneer. Out of 32 times, VNE closed lower 65.63% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 68.75% with an average market move of -3.75%.