XEMUSD finds buyers at key support level
XEM/US Dollar Index (XEMUSD) Technical Analysis Report for Jan 23, 2020 | by Techniquant Editorial Team
XEMUSD finished Thursday at 0.0394 tanking $0.0039 (-9.01%) on high volume. This is the biggest single-day loss in over four months. The last time we've seen such an unusually strong single-day loss on December 17, 2019, XEMUSD actually gained 7.37% on the following trading day. The bears were in full control today, moving the market lower throughout the whole session. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (XEMUSD as at Jan 23, 2020):
Thursday's trading range has been $0.0047 (10.85%), that's far above the last trading month's daily average range of $0.0022. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for XEMUSD.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. 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.
After trading down to 0.0386 earlier during the day, the cryptocurrency bounced off the key technical support level at 0.0389 (S1). The failure to close below the support might increase that levels importance as support going forward. Prices broke below the key technical support level at 0.0408 (now R1), which is likely to act as resistance going forward. After having been unable to move above 0.0435 in the previous session, NEM ran into sellers again around the same price level today, missing to move higher than 0.0433.
Crossing below the upper Bollinger Band, prices have lost at least some of their upward momentum in the short-term and could now be heading back down towards the mean of the Bollinger Bands at 0.0355.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the 11 market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close crossed below the upper Bollinger Band" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for XEM/USD. Out of 28 times, XEMUSD closed higher 64.29% 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 53.57% with an average market move of 11.02%.
With seven out of the seven Major Cryptocurrencies closing lower today, the ones that stand out on the negative side are ETCUSD losing -9.63% and LTCUSD closing -6.3% lower. None of the markets managed to end the day in the green. Looking at the other Minor Cryptocurrencies, the winners of the day have been BCNUSD surging 19.15% and LSKBTC closing 7.06% higher. The worst performers of the day have been BTGUSD tanking -9.33% and BTGBTC closing -7.2% lower. Read more