CADSGD snaps to lowest close since August 10th
Canadian Dollar/Singapore Dollar (CADSGD) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, CADSGD finished Wednesday at 1.0309 losing 13 pips (-0.13%). Today's close at 1.0309 marks the lowest recorded closing price since August 10th. Closing below Tuesday's low at 1.0313, CAD/SGD confirmed its breakout through the prior session low after trading up to 17 pips below it intraday.
Daily Candlestick Chart (CADSGD as at Sep 16, 2020):
Wednesday's trading range has been 38 pips (0.37%), that's below the last trading month's daily average range of 53 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for CADSGD.
After trading down to 1.0296 earlier during the day, the currency bounced off the key technical support level at 1.0296 (S1). The failure to close below the support could increase that levels importance as support going forward. When prices bounced off a significant support level the last time on September 11th, CADSGD actually lost -0.27% on the following trading day. Prices are trading close to the key technical resistance level at 1.0337 (R1).
With another close below the lower Bollinger Band, prices are confirming their strong downward momentum in the short-term. A rally back into the Bollinger Band on the next trading day though might signal a potential change in momentum that could lead to a correction back up towards the center of the Bollinger Bands at 1.0388.
While 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.
Further selling could move prices lower should the market test August's nearby low at 1.0239.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Although it is usually interpreted as bullish, it has actually shown to be bearish for CAD/SGD. Out of 645 times, CADSGD closed lower 51.01% 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 57.67% with an average market move of -0.12%.
With four out of the seven Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 0.61% and NZDUSD closing 0.27% higher. On the flipside the worst performers have been USDJPY closing -0.47% lower and EURUSD losing -0.25%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been GBPPLN surging 0.81% and ZARJPY closing 0.78% higher. The worst performers of the day have been EURZAR tanking -1.42% and CHFZAR closing -1.28% lower. Read more