CHFEUR breaks above 50-day moving average for the first time since July 10th
Swiss Franc/Euro (CHFEUR) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, CHFEUR finished Wednesday at 0.9306 gaining 11 pips (0.12%). Today's close at 0.9306 marks the highest recorded closing price since August 26th. Closing above Tuesday's high at 0.9300, the pair confirmed its breakout through the previous session high after trading up to 13 pips above it intraday.
Daily Candlestick Chart (CHFEUR as at Sep 16, 2020):
Wednesday's trading range has been 25 pips (0.27%), that's below the last trading month's daily average range of 38 pips. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for CHFEUR.
The FX pair managed to close above the 50-day moving average at 0.9293 for the first time since July 10th. Unable to break through the key technical resistance level at 0.9310 (R1), the forex pair closed below it after spiking up to 0.9313 earlier during the day. The failure to close above the resistance might increase that levels significance going forward. When prices bounced off a significant resistance level the last time on September 2nd, CHFEUR actually gained 0.15% on the following trading day.
Though CHF/EUR is experiencing a short-term uptrend, this could just be a correction, as both the medium and long-term trends are still bearish.
Selling might speed up should prices move below the close-by swing low at 0.9271 where further sell stops could get activated. Further buying might move prices higher should the market test August's nearby high at 0.9327.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing Low" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for CHF/EUR. Out of 888 times, CHFEUR closed higher 50.23% 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 56.31% with an average market move of 0.10%.