CHFEUR closes above its opening price after recovering from early selling pressure
Swiss Franc/Euro (CHFEUR) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
CHFEUR ended the month -1.13% lower at 0.9292 after gaining 7 pips (0.08%) today on high volume. Trading up to 23 pips lower after the open, the currency managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on July 24th, CHFEUR actually lost -0.76% on the following trading day. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (CHFEUR as at Jul 31, 2020):
Friday's trading range has been 44 pips (0.47%), that's slightly below the last trading month's daily average range of 46 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for CHFEUR. Prices continued to consolidate within a tight trading range between 0.9261 and 0.9316 where it has been caught now for the last three trading days.
One bullish candlestick pattern matches today's price action, the Bullish Spinning Top.
After trading down to 0.9261 earlier during the day, the forex pair bounced off the key technical support level at 0.9264 (S1). The failure to close below the support could increase that levels significance as support going forward. Prices are trading close to the key technical resistance level at 0.9316 (R1).
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying might accelerate should prices move above the close-by swing high at 0.9316 where further buy stops could get activated.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Spinning Top" stand out. Its common bullish interpretation has been confirmed for CHF/EUR. Out of 264 times, CHFEUR closed higher 53.41% 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 56.06% with an average market move of 0.08%.