CHFJPY closes lower for the 2nd day in a row
Swiss Franc/Japanese Yen (CHFJPY) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, CHFJPY ended the week 0.56% higher at 110.83 after edging lower 6 pips (-0.05%) today. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (CHFJPY as at May 22, 2020):
Friday's trading range has been 55 pips (0.5%), that's slightly below the last trading month's daily average range of 633 pips. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for CHFJPY. Prices continued to consolidate within a tight trading range between 109.90 and 111.66 where it has been caught now for the whole last trading week.
One bearish candlestick pattern matches today's price action, the Hanging Man. The last time a Hanging Man showed up on March 27th, CHFJPY lost -0.94% on the following trading day.
After trading as low as 110.45 during the day, the pair found support at the 200-day moving average at 110.67.
While the forex 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 accelerate should prices move above the close-by swing high at 111.66 where further buy stops might get activated. Selling could speed up should prices move below the nearby swing low at 109.70 where further sell stops might get triggered. With prices trading close to this year's high at 114.39, upside momentum could accelerate should the currency be able to break out to new highs for the year. Trading close to March's high at 114.00 we might see further upside momentum if potential buy stops at the level get activated. As prices are trading close to May's low at 108.70, downside momentum could speed up should the FX pair mark new lows for the month.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Hanging Man" stand out. Its common bearish interpretation has been confirmed for CHF/JPY. Out of 57 times, CHFJPY closed lower 52.63% of the time on the next trading day after the market condition occurred.
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