ZBRA unable to break through key resistance level
Zebra Technologies Corporation (ZBRA) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
ZBRA finished the week 11.82% higher at 243.54 after edging lower $0.61 (-0.25%) today, slightly underperforming the S&P 500 (0.24%) ahead of tomorrow's Memorial Day market holiday. Trading $1.79 higher after the open, the market 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 missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (ZBRA as at May 22, 2020):
Friday's trading range has been $4.96 (2.03%), that's below the last trading month's daily average range of $8.08. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently strongly lower than usual for ZBRA. Prices continued to consolidate within a tight trading range between 239.99 and 246.35 where it has been caught now for the last three trading days.
Two candlestick patterns are matching today's price action, the Northern Doji which is known as bearish pattern and one neutral pattern, the Doji.
Unable to break through the key technical resistance level at 245.11 (R1), Zebra Technologies closed below it after spiking up to 245.54 earlier during the day. The failure to close above the resistance might increase that levels importance going forward. The stock found buyers again today around 240.58 for the third trading day in a row after having found demand at 241.01 in the previous session and at 239.99 two days ago. The last time this happened on March 31st, ZBRA actually lost -3.89% on the following trading day.
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Buying could accelerate should prices move above the close-by swing high at 246.35 where further buy stops might get activated. With prices trading close to this year's high at 260.40, upside momentum could speed up should the share be able to break out to new highs for the year. Further buying might move prices higher should the market test April's nearby high at 248.21.
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. While it is usually interpreted as bearish, it has actually shown to be bullish for Zebra Technologies. Out of 627 times, ZBRA closed higher 54.55% 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 57.74% with an average market move of 1.12%.