FXI drops to lowest close since July 1st
iShares China Large-Cap ETF (FXI) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, FXI finished the month 4.21% higher at 41.37 after losing $0.41 (-0.98%) today. Today's close at 41.37 marks the lowest recorded closing price since July 1st. Closing below Thursday's low at 41.38, FXI ETF confirmed its breakout through the prior session low after trading up to $0.29 below it intraday.
Daily Candlestick Chart (FXI as at Jul 31, 2020):
Friday's trading range has been $0.56 (1.35%), that's slightly above the last trading month's daily average range of $0.52. Things look different on the weekly timeframe, where the market's trading range of the last week has been way below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for FXI.
After trading as low as 41.09 during the day, the ETF found support at the 50-day moving average at 41.31. The last time this happened on November 21, 2019, FXI actually lost -0.17% on the following trading day.
Although the market is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Closed below last periods low" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for FXI ETF. Out of 196 times, FXI closed higher 57.65% 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 54.08% with an average market move of 0.23%.