CADEUR closes higher for the 2nd day in a row
Canadian Dollar/Euro (CADEUR) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, CADEUR ended Wednesday at 0.6421 gaining 19 pips (0.3%). Closing above Tuesday's high at 0.6412, CAD/EUR confirmed its breakout through the previous session high after trading up to 28 pips above it intraday.
Daily Candlestick Chart (CADEUR as at Sep 16, 2020):
Wednesday's trading range has been 48 pips (0.75%), that's above the last trading month's daily average range of 40 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for CADEUR. Prices continued to consolidate within a tight trading range between 0.6386 and 0.6447 where it has been caught now for the whole last trading week.
One bearish candlestick pattern matches today's price action, the Bearish Hikkake Pattern. The last time a Bearish Hikkake Pattern showed up on September 7th, CADEUR lost -0.71% on the following trading day.
The pair managed to close back above the 50-day moving average at 0.6412 for the first time since September 9th. After spiking up to 0.6440 during the day, the currency found resistance at the 20-day moving average at 0.6426. The forex pair found buyers again today around 0.6392 for the third trading day in a row after having found demand at 0.6389 in the prior session and at 0.6387 two days ago.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying might speed up should prices move above the nearby swing high at 0.6447 where further buy stops could get activated. Selling might accelerate should prices move below the close-by swing low at 0.6387 where further sell stops could get triggered. As prices are trading close to September's high at 0.6481, upside momentum might speed up should the market mark new highs for the month.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Bounce off SMA 20" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for CAD/EUR. Out of 134 times, CADEUR closed higher 54.48% 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 60.45% with an average market move of 0.36%.