CHFHKD finds support at 20-day moving average
Swiss Franc/Hong Kong Dollar (CHFHKD) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, CHFHKD ended the week 0.1% higher at 7.9860 after losing 56 pips (-0.07%) today on high volume. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (CHFHKD as at May 22, 2020):
Friday's trading range has been 290 pips (0.36%), that's far below the last trading month's daily average range of 514 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 CHFHKD.
Two candlestick patterns are matching today's price action, the Bullish Hikkake Pattern which is known as bullish pattern and one bearish pattern, the Bearish Spinning Top. The last time a Bearish Spinning Top showed up on Tuesday, CHFHKD actually gained 0.69% on the following trading day.
After trading as low as 7.9682 during the day, the currency found support at the 20-day moving average at 7.9838.
Though the FX pair is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could speed up should prices move above the close-by swing high at 8.0407 where further buy stops might get triggered. Selling could accelerate should prices move below the nearby swing low at 7.9409 where further sell stops might get activated. Further selling could move prices lower should the market test April's close-by low at 7.9071.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "2 Consecutive Lower Closes" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for CHF/HKD. Out of 335 times, CHFHKD closed higher 53.73% 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 51.34% with an average market move of 0.16%.
With four out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are GBPUSD losing -0.47% and EURUSD closing -0.44% lower. On the flipside the best performers have been USDCAD closing 0.33% higher and USDCHF gaining 0.08%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDCZK surging 1.09% and USDHUF closing 0.9% higher. The worst performers of the day have been USDMXN tanking -0.58% and SGDHKD closing -0.51% lower. Read more