WING runs into sellers around 77.53 for the third day in a row
Wingstop Inc. (WING) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, WING ended Thursday at 75.35 gaining $1.33 (1.8%), notably underperforming the S&P 500 (6.24%). Trading up to $3.37 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 March 17th, WING actually lost -21.24% on the following trading day. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (WING as at Mar 26, 2020):
Thursday's trading range has been $5.82 (7.75%), that's slightly below the last trading month's daily average range of $7.21. Things look different on the weekly timeframe, where the market's trading range of the last week has been above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for WING. Prices continued to consolidate within a tight trading range between 66.53 and 78.01 where it has been caught now for the last three trading days.
Three candlestick patterns are matching today's price action, the Bearish Hikkake Pattern and the Northern Doji which are both known as bearish patterns and one neutral pattern, the Doji.
Prices are trading close to the key technical resistance level at 78.70 (R1). The market ran into sellers again today around 77.53 for the third trading day in a row after having found sellers at 76.86 in the previous session and at 78.01 two days ago.
Though Wingstop is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could speed up should prices move above the nearby swing high at 78.01 where further buy stops might get triggered. As prices are trading close to March's high at 85.33, upside momentum could accelerate should the share mark new highs for the month.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Northern Doji" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for Wingstop. Out of 43 times, WING closed higher 62.79% 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 62.79% with an average market move of 1.42%.