CADGBP breaks below Tuesday's low
Canadian Dollar/British Pound (CADGBP) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, CADGBP ended Wednesday at 0.5852 losing 32 pips (-0.54%). Closing below Tuesday's low at 0.5879, CAD/GBP confirmed its breakout through the previous session low after trading up to 44 pips below it intraday.
Daily Candlestick Chart (CADGBP as at Sep 16, 2020):
Wednesday's trading range has been 58 pips (0.99%), that's above the last trading month's daily average range of 48 pips. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for CADGBP.
One bearish candlestick pattern matches today's price action, the Black Candle.
Prices are trading close to the key technical support level at 0.5822 (S1). Prices broke below the key technical support level at 0.5873 (now R1), which is likely to act as resistance going forward.
The forex pair shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "3 Consecutive Lower Closes" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for CAD/GBP. Out of 151 times, CADGBP closed higher 61.59% 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 54.30% with an average market move of 0.24%.