KMDUSD crashes -5.88% closing $0.03 lower
Komodo/US Dollar Index (KMDUSD) Technical Analysis Report for Nov 22, 2020 | by Techniquant Editorial Team
KMDUSD ended Sunday at 0.48 tanking $0.03 (-5.88%). This is the biggest single-day loss in over two weeks. The bears were in full control today, moving the market lower throughout the whole session.
Daily Candlestick Chart (KMDUSD as at Nov 22, 2020):
Sunday's trading range has been $0.05 (9.62%), that's far above the last trading month's daily average range of $0.04. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for KMDUSD.
Even with a strong opening KMD closed below the previous day's open and close, forming a bearish Engulfing Candle. Additionally, two candlestick patterns are matching today's price action, the Bearish Belt-hold and the Black Candle which are both known as bearish patterns.
KMD/USD closed back below the 50-day moving average at 0.49. When this moving average was crossed below the last time on September 2nd, KMDUSD lost -14.29% on the following trading day.
Crossing below the upper Bollinger Band, prices have lost at least some of their upward momentum in the short-term and might now be heading back down towards the mean of the Bollinger Bands at 0.46.
While the market is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Selling might accelerate should prices move below the nearby swing low at 0.45 where further sell stops could get activated.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Break through SMA 50" stand out. Its common bearish interpretation has been confirmed for KMD/USD. Out of 36 times, KMDUSD closed lower 47.22% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 63.89% with an average market move of -0.87%.