WBA finds buyers around 40.08 for the third day in a row
Walgreens Boots Alliance Inc. (WBA) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
WBA finished the month -3.96% lower at 40.71 after gaining $0.07 (0.17%) today, notably underperforming the Nasdaq 100 (1.78%). 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 (WBA as at Jul 31, 2020):
Friday's trading range has been $0.81 (2.01%), that's below the last trading month's daily average range of $1.15. 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 WBA. Prices continued to consolidate within a tight trading range between 39.99 and 41.26 where it has been caught now for the last three trading days.
Even with a weak opening the market managed to close above the prior day's open and close, forming a bullish Engulfing Candle. Additionally, two candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns. The last time a Bullish Short Candle showed up on July 2nd, WBA gained 2.81% on the following trading day.
Prices are trading close to the key technical resistance level at 40.97 (R1). The stock found buyers again today around 40.08 for the third trading day in a row after having found demand at 39.99 in the previous session and at 40.11 two days ago.
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 41.26 where further buy stops might get activated. Selling could accelerate should prices move below the nearby swing low at 39.99 where further sell stops might get triggered.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Engulfing Candle" stand out. Its common bullish interpretation has been confirmed for Walgreens Boots. Out of 63 times, WBA closed higher 52.38% 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 60.32% with an average market move of 1.25%.