CADNZD pushes through key technical resistance level
Canadian Dollar/New Zealand Dollar (CADNZD) Technical Analysis Report for Jul 13, 2020 | by Techniquant Editorial Team
CADNZD ended Monday at 1.1236 gaining 44 pips (0.39%) on low volume. The bulls were in full control today, moving the market higher throughout the whole session. Closing above Friday's high at 1.1231, the forex pair confirmed its breakout through the previous session high after trading up to 11 pips above it intraday.
Daily Candlestick Chart (CADNZD as at Jul 13, 2020):
Monday's trading range has been 61 pips (0.55%), that's below the last trading month's daily average range of 80 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for CADNZD.
In spite of a weak opening the pair managed to close above the prior day's open and close, forming a bullish Engulfing Candle. The last time this candlestick pattern showed up on June 24th, CADNZD actually lost -0.31% on the following trading day. Additionally, one bullish candlestick pattern matches today's price action, the White Candle.
Buyers managed to take out the key technical resistance level at 1.1199 (now S1), which is likely to act as support going forward. After having been unable to move lower than 1.1174 in the previous session, CAD/NZD found buyers again around the same price level today at 1.1181.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying could speed up should prices move above the nearby swing high at 1.1273 where further buy stops might get activated. Selling could accelerate should prices move below the close-by swing low at 1.1174 where further sell stops might get triggered.
Among the 10 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Engulfing Candle" stand out. Its common bullish interpretation has been confirmed for CAD/NZD. Out of 112 times, CADNZD closed higher 55.36% of the time on the next trading day after the market condition occurred.