VRSN closes below its opening price unable to hold early session gains
VeriSign Inc. (VRSN) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
VRSN finished Wednesday at 202.99 losing $1.34 (-0.66%), slightly underperforming the S&P 500 (-0.46%). Trading $1.78 higher after the open, the stock was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (VRSN as at Sep 16, 2020):
Wednesday's trading range has been $4.76 (2.31%), that's slightly above the last trading month's daily average range of $4.63. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for VRSN.
Notwithstanding a strong opening VeriSign closed below the previous day's open and close, forming a bearish Engulfing Candle. The last time this candlestick pattern showed up on September 3rd, VRSN lost -2.04% on the following trading day. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle.
Prices are trading close to the key technical support level at 201.69 (S1). After spiking up to 207.52 during the day, the share found resistance at the 50-day moving average at 206.72.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Bounce off SMA 50" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for VeriSign. Out of 22 times, VRSN closed higher 59.09% 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 72.73% with an average market move of 2.63%.