CHFJPY crashes -0.61% closing 71 pips lower
Swiss Franc/Japanese Yen (CHFJPY) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, CHFJPY ended Wednesday at 115.40 tanking 71 pips (-0.61%). This is the biggest single-day loss in over a month. Today's close at 115.40 marks the lowest recorded closing price since July 30th. The bears were in full control today, moving the market lower throughout the whole session. Closing below Tuesday's low at 116.00, the market confirmed its breakout through the prior session low after trading up to 72 pips below it intraday.
Daily Candlestick Chart (CHFJPY as at Sep 16, 2020):
Wednesday's trading range has been 91 pips (0.78%), that's slightly above the last trading month's daily average range of 89 pips. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for CHFJPY.
One bearish candlestick pattern matches today's price action, the Black Candle.
CHF/JPY closed below the 50-day moving average at 115.77 for the first time since May 25th.
Crossing below the lower Bollinger Band for the first time since September 8th, prices have shown unusually strong downward momentum in the short-term. This could either indicate a potential selling climax after which prices might head back up towards the mean of the Bollinger Bands at 116.45 or signal the beginning of a strong momentum breakout leading to even lower prices. The last time prices broke out below the lower Bollinger Band on September 8th, CHFJPY actually gained 0.74% on the following trading day.
Though the FX pair is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Selling might accelerate should prices move below the close-by swing low at 115.16 where further sell stops could get activated. Further selling might move prices lower should the market test August's nearby low at 114.98.
Among the 13 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bearish Break through SMA 50" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for CHF/JPY. Out of 83 times, CHFJPY closed higher 60.24% 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 56.63% with an average market move of 0.41%.
With four out of the seven Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 0.61% and NZDUSD closing 0.27% higher. On the flipside the worst performers have been USDJPY closing -0.47% lower and EURUSD losing -0.25%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been GBPPLN surging 0.81% and ZARJPY closing 0.78% higher. The worst performers of the day have been EURZAR tanking -1.42% and CHFZAR closing -1.28% lower. Read more