CHFCAD stuck within tight trading range
Swiss Franc/Canadian Dollar (CHFCAD) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
CHFCAD ended the week -0.72% lower at 1.4418 after gaining 38 pips (0.26%) today on low volume. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (CHFCAD as at May 22, 2020):
Friday's trading range has been 99 pips (0.69%), that's below the last trading month's daily average range of 139 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 CHFCAD. Prices continued to consolidate within a tight trading range between 1.4333 and 1.4461 where it has been caught now for the last three trading days.
After spiking up to 1.4461 during the day, the pair found resistance at the 20-day moving average at 1.4432. The last time this happened on February 24th, CHFCAD actually gained 0.21% on the following trading day. After having been unable to move lower than 1.4347 in the prior session, the FX pair found buyers again around the same price level today at 1.4362.
The market shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
Buying could speed up should prices move above the nearby swing high at 1.4533 where further buy stops might get activated. Further selling could move prices lower should the market test April's close-by low at 1.4221.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. Though it is usually interpreted as neutral, it has actually shown to be bullish for CHF/CAD. Out of 757 times, CHFCAD closed higher 51.92% 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 54.43% with an average market move of 0.29%.