Dril-Quip Inc (NYSE:DRQ) missed on earnings and fell sharply after the announcement on May 9. The low of the day touched around 99 before closing back over 100, but down 7%.
Technically it printed a long shadowed Hammer Candle, indicating a weak open and move lower but stronger finish. This is often a reversal candle but needs to be confirmed. That put it on the radar this weekend. Monday came and it saw more of the same, starting and ending lower. But a turnaround started Tuesday with a bullish engulfing candle and it was confirmed higher Wednesday. Notice that is also moved back into the Bollinger® bands. The RSI is bouncing off of an oversold condition but the MACD is still falling.
What is interesting is that not one analyst changed their view on the company following the report, and their mean target is 120. Maybe that is why it has not rebounded strongly yet. No Capitulation. But the close Wednesday moves it higher into the gap, and gives a good reward to risk trade opportunity against the low looking for a gap fill. Now it is time to take it off the radar and into the trading book.
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