FXY dominated by bears dragging the market lower throughout the day
CurrencyShares Japanese Yen ETF (FXY) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
FXY finished the month 1.96% higher at 89.43 after tanking $0.97 (-1.07%) today on high volume. This is the biggest single-day loss in over four months. The bears were in full control today, moving the market lower throughout the whole session.
Daily Candlestick Chart (FXY as at Jul 31, 2020):
Friday's trading range has been $0.50 (0.56%), that's far above the last trading month's daily average range of $0.26. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for FXY.
One bearish candlestick pattern matches today's price action, the Black Candle. The last time a Black Candle showed up on July 20th, FXY actually gained 0.48% on the following trading day.
Prices are trading close to the key technical support level at 89.24 (S1).
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 88.82.
While still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Among the seven 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. Its common bearish interpretation has been confirmed for FXY. Out of 67 times, FXY closed lower 55.22% 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 61.19% with an average market move of -0.49%.