CHFAUD dominated by bears dragging the market lower throughout the day
Swiss Franc/Australian Dollar (CHFAUD) Technical Analysis Report for Jun 01, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, CHFAUD ended Monday at 1.5312 tanking 291 pips (-1.87%). This is the biggest single-day loss in over two months. The last time we've seen such an unusually strong single-day loss on May 18th, CHFAUD lost -0.25% on the following trading day. Today's close at 1.5312 marks the lowest recorded closing price since February 19th. The bears were in full control today, moving the market lower throughout the whole session. Closing below Friday's low at 1.5552, the FX pair confirmed its breakout through the prior session low after trading up to 266 pips below it intraday.
Daily Candlestick Chart (CHFAUD as at Jun 01, 2020):
Monday's trading range has been 363 pips (2.32%), that's far above the last trading month's daily average range of 187 pips. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for CHFAUD.
One bearish candlestick pattern matches today's price action, the Black Candle.
The forex pair closed below the 200-day moving average at 1.5392 for the first time since May 8, 2019.
Crossing below the lower Bollinger Band for the first time since April 9th, prices have shown unusually strong downward momentum in the short-term. This might either indicate a potential selling climax after which prices could head back up towards the mean of the Bollinger Bands at 1.5768 or signal the beginning of a strong momentum breakout leading to even lower prices.
Although still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Break through SMA 200" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for CHF/AUD. Out of 61 times, CHFAUD closed higher 55.74% 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 60.66% with an average market move of 0.56%.