WY closes above its opening price after recovering from early selling pressure
Weyerhaeuser Company (WY) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, WY ended Thursday at 18.28 gaining $0.56 (3.16%), significantly underperforming the S&P 500 (6.24%). Trading up to $0.51 lower after the open, the market managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on March 13th, WY actually lost -22.67% 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 (WY as at Mar 26, 2020):
Thursday's trading range has been $1.25 (7.01%), that's below the last trading month's daily average range of $1.93. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently strongly higher than usual for WY.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar.
Buyers managed to take out the key technical resistance level at 18.20 (now S1), which is likely to act as support going forward.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying might accelerate should prices move above the close-by swing high at 19.27 where further buy stops could get triggered.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "3 Consecutive Higher Closes" stand out. Its common bullish interpretation has been confirmed for Weyerhaeuser. Out of 174 times, WY closed higher 49.43% 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 56.32% with an average market move of 0.29%.