YEXT breaks below key technical support level
Yext Inc. (YEXT) Technical Analysis Report for Jan 24, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, YEXT finished the week -3.77% lower at 15.04 after losing $0.28 (-1.83%) today, underperforming the S&P 500 (-0.9%). Closing below Thursday's low at 15.19, the stock confirmed its breakout through the prior session low after trading up to $0.34 below it intraday.
Daily Candlestick Chart (YEXT as at Jan 24, 2020):
Friday's trading range has been $0.72 (4.67%), that's far above the last trading month's daily average range of $0.46. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for YEXT.
In a volatile session, prices traded above the previous day's high as well as below the prior day's low, forming a bearish Outside Bar. The last time this happened on December 20, 2019, YEXT actually gained 2.77% on the following trading day. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle.
After trading as low as 14.85 during the day, the market found support at the 20-day moving average at 14.98. Prices broke below the key technical support level at 15.06 (now R1), which is likely to act as resistance going forward. After having been unable to move above 15.51 in the previous session, Yext ran into sellers again around the same price level today, failing to move higher than 15.57.
Though the share is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
With prices trading close to this year's low at 14.07, downside momentum could accelerate should YEXT break out to new lows for the year.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to prior High" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for Yext. Out of 181 times, YEXT closed higher 55.80% 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 54.70% with an average market move of 0.85%.