USPH) Stock Technicals Hit Inflection Point

 

Decision Time: U.S. Physical Therapy Inc (NYSE:USPH) Stock Technicals Hit Inflection Point

 

U.S. Physical Therapy Inc technical rating as of

2017-04-23

(USPH Price of Stock at Publication: $64.2)


Decision Time: U.S. Physical Therapy Inc (NYSE:USPH) now sits in the perhaps the most difficult technical position — the stock has no urgency in its direction and that has left it at an inflection point. Watch the key moving average levels that we discuss below and further, watch the stochastics, technical oscillators and momentum readings for any kind of hint to direction.

The company has a three bull momentum rating which indicates an inflection point. It may seem obvious, but this is the time to put the stock on alert — a meaningful move in either direction now will likely swing momentum into a channel that could be decidedly up or down.

 
With the current stock price and the moving averages showing signs of indecision, any consecutive day stock move in either direction will likely push the stock into a bearish or bullish momentum channel that could persist for the short-term. This is a critical inflection point.

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USPH is down -6.6% over the last three months and up +4.6% over the last six months. The stock price is up +29.1% over the last year. The current stock price is $64.2.

The technical rating goes from a rating of one, the weakest upside technical, to a rating of five,
the highest upside technical. This is strictly focusing on price and technical — that means we focus on real-time stock price movement and then position it relative to the simple moving averages. To make the technical rating meaningful, the moving averages are also compared to each other.

If you’re looking for the simplest version of this, here it is — when the short-term moving averages are above the long-term moving averages that indicates relative strength in the technical. Then see the current price relative to the highest moving average and you will have a “back of the envelope” technical indicator in your back pocket for any stock at any time.

The blending and weighting of numbers above created the technical model built by Capital Market Laboratories (www.CMLviz.com).
Note the stock price at publication ($64.2), since the technical rating is based on intraday stock prices.
 

Technicals   |   Support: 63.15   |   Resistance: 65.35   

 

Golden Cross Alert: The 50 day MA is now above the 200 day moving average.

As we noted above — the back of the envelope rule here is that when shorter-term moving averages move above the longer-term ones, momentum is building. We have that right now.

Swing Death Cross Alert: The short-term 10 day moving average is now below the 50 day moving average.

Recall that when we see the shortest-term moving average (10-day in this case) fall below any other moving average (50-day in this case), it indicates weakening momentum.

We can set aside oscillators and stochastics, we are simply in no man’s land: U.S. Physical Therapy Inc has a three bull technical rating which puts it at an inflection point because while it’s trading above its 10 day moving average, its trading below both the 50- and 200 day simple moving averages and the 10 day moving average is below the 50 day moving average (“swing death cross”). The fact that the stock is up 0.31% today and that the stockprice is above the 10-day moving average puts it an a critical inflection point.
We now turn to the actual numbers driving this rating:

U.S. Physical Therapy Inc (NYSE:USPH) rating statistics:

10-day moving average: $63.97

50-day moving average: $69.15

200-day moving average: $65.29

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U.S. Physical Therapy Inc Realized Volatility Hits An Inflection Point


U.S. Physical Therapy Inc (NYSE:USPH) Realized Volatility Hits An Inflection Point



Stock Alert and Holding Pattern


Before we cover the full analysis we make a quick alert here that U.S. Physical Therapy Inc (NYSE:USPH) has seen its stock price move at an inflection point level. We’ll go through the details below — but that’s the lede — the stock has been behaving, roughly speaking, ‘normally.’ If there was a post it note to summarize the stock movement in the last 30-days it would likely read “holding pattern.” The HV20 is 29.75% verus the HV20 of the S&P 500 at 7.04%.

But don’t confuse a holding pattern with low risk — this is quite possibly an inflection point.

Another bit to this holding pattern, which we cover in the article, is that while the historical volatility may be an inflection point level, the real question that needs to be answered for option traders is not if the HV20 is high or low, but rather if the implied volatility that is priced for the next 30-days accuratley reflects what we’re about to see in the stock for the next month.

To jump forward and examine if owning or shorting options has been a positive trade in U.S. Physical Therapy Inc, you can go here: Getting serious about option trading.


PREFACE


This is a proprietary realized volatility rating created by Capital Market Laboratories (CMLviz) based on a large number of data interactions for U.S. Physical Therapy Inc (NYSE:USPH) . We examine
the little used gem of daily stock volatility over a 20-day and 30-day trading period, as well as comparisons to the last year and the actual stock returns over the last three- and six-months
and the S&P 500 and Nasdaq 100 indices.

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As a heads up, in the “Why This Matters” section at the end of this article on U.S. Physical Therapy Inc (NYSE:USPH) , we’re going to take a step back and show really clearly
that there is actually a lot less “luck” in successful option trading than most people are aware of. This idea of an “option trading expert” is vastly over complicated
so those with the information advantage can continue to profit at the expense of the rest.

But before that, let’s turn back to USPH. Here are the exact steps that led us to this rating, and whether it’s a risk alert or a holding pattern.

USPH Recent Realized Volatility








Rating


Realized volatility using proprietary measures has hit an inflection point level.




Let’s take a deep dive into some institutional level volatility measures for U.S. Physical Therapy Inc (NYSE:USPH) .

U.S. Physical Therapy Inc Stock Performance


USPH is down -12.9% over the last three months and down -3.6% over the last six months. The stock price is up +28.4% over the last year. The current stock price is $61.9.


USPH Step 1: Stock Returns



The one-year stock return does not impact the volatility rating since we are looking at a shorter time horizon. However, the rating does examine the 3-month returns and the
absolute difference between the 3-month and 6-month returns.

  The 3-month stock return of -12.9% has a small impact on the realized volatility rating for USPH.
  The small difference between the 3-month and 6-month stock returns does not impact the realized volatility rating for USPH.



USPH Step 2: Daily Realized Volatility Level


The HV30® takes the stock’s day to day historical volatility over the last 30-days and then annualizes it. The HV20 looks back over just 20-days — a shorter time period. Here is the breakdown for U.S. Physical Therapy Inc (NYSE:USPH) and how the day-by-day realized historical volatilities have impacted the rating:

  The HV20 of 29.6% is low enough that it has a downward impact on USPH’s volatility rating.

USPH Step 3: U.S. Physical Therapy Inc HV20 Compared to Indices


* The HV20 for USPH is substantially larger than that for both the S&P 500 and the NASDAQ 100 which raises the volatility rating.

* The HV20 for USPH is substantially larger than that for the Health Care ETF (XLV) which raises the volatility rating.

Here is summary data in tabular and chart format.



           USPH
           HV20    
   S&P 500
HV20
   NASDAQ 100
HV20   
   XLV
HV20   
           29.6%    7.04%    7.58%    7.29%





USPH Step 4: Daily Volatility Percentiles and Highs

We also examine the annual high of the HV30 in our rating but in this case the 52 week high in HV30 for USPH is 37.6%,
which is not enough to impact the realized volatility rating.

Here is summary data in tabular and chart format.



           USPH
           HV20    
   USPH
HV30
   USPH
HV30 High   
           29.6%    29.8%    37.6%





Final Realized Volatility Percentile Level: USPH


The final evolution of the volatility rating for U.S. Physical Therapy Inc is a comparison of the HV30 value relative to its past, which is neatly summarized in the percentile — a scoring mechanism that goes from a low of 1 to a high of 100.

 
The HV30 percentile for U.S. Physical Therapy Inc is 65%, which means the stock has seen elevated volatile price movement relative to its own past and
that has a small impact on the realized volatility rating.



U.S. Physical Therapy Inc Realized Volatility Percentiles



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