CHFGBP dominated by bulls lifting the market higher throughout the day
Swiss Franc/British Pound (CHFGBP) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
CHFGBP finished the week -0.45% lower at 0.8465 after gaining 33 pips (0.39%) today on low volume. The bulls were in full control today, moving the market higher throughout the whole session. 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 (CHFGBP as at May 22, 2020):
Friday's trading range has been 47 pips (0.56%), that's far below the last trading month's daily average range of 75 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for CHFGBP.
During the whole day, prices traded within the prior day's range, unable to trade above the previous day's high or below the prior day's low forming an Inside Bar. Additionally, two candlestick patterns are matching today's price action, the Bullish Short Candle and the White Candle which are both known as bullish patterns. The last time a Bullish Short Candle showed up on April 20th, CHFGBP gained 0.95% on the following trading day.
Prices are trading close to the key technical resistance level at 0.8493 (R1). After having been unable to move lower than 0.8418 in the previous session, CHF/GBP found buyers again around the same price level today at 0.8420.
The market shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
Buying might accelerate should prices move above the nearby swing high at 0.8493 where further buy stops could get triggered.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Close to Swing High" stand out. Although it is usually interpreted as neutral, it has actually shown to be bullish for CHF/GBP. Out of 753 times, CHFGBP closed higher 50.60% 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 50.73% with an average market move of 0.11%.