CADUSD closes higher for the 3rd day in a row
Canadian Dollar/US Dollar (CADUSD) Technical Analysis Report for Jul 06, 2020 | by Techniquant Editorial Team
Moving higher for the 3rd day in a row, CADUSD ended Monday at 0.7385 gaining 5 pips (0.07%) on low volume. Closing above Friday's high at 0.7383, the FX pair confirmed its breakout through the previous session high after trading up to 14 pips above it intraday.
Daily Candlestick Chart (CADUSD as at Jul 06, 2020):
Monday's trading range has been 25 pips (0.34%), that's far below the last trading month's daily average range of 54 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for CADUSD.
Three candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns and one bearish pattern, the Last Engulfing Top Pattern. The last time a Bullish Short Candle showed up on May 8th, CADUSD actually lost -0.58% on the following trading day.
The pair shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Selling might accelerate should prices move below the close-by swing low at 0.7340 where further sell stops could get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Last Engulfing Top Pattern" stand out. Its common bearish interpretation has been confirmed for CAD/USD. Out of 90 times, CADUSD closed lower 52.22% 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 57.78% with an average market move of -0.08%.