CHFJPY closes below its opening price unable to hold early session gains
Swiss Franc/Japanese Yen (CHFJPY) Technical Analysis Report for Oct 26, 2020 | by Techniquant Editorial Team
CHFJPY finished Monday at 115.48 losing 36 pips (-0.31%). Trading 33 pips higher after the open, the forex pair was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on October 14th, CHFJPY actually gained 0.17% on the following trading day. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (CHFJPY as at Oct 26, 2020):
Monday's trading range has been 50 pips (0.43%), that's below the last trading month's daily average range of 71 pips. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for CHFJPY. Prices continued to consolidate within a tight trading range between 115.24 and 115.96 where it has been caught now for the last three trading days.
Prices are trading close to the key technical support level at 115.16 (S1). The pair closed back below the 50-day moving average at 115.67. After having been unable to move above 115.94 in the prior session, the market ran into sellers again around the same price level today, missing to move higher than 115.96.
While still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Selling might accelerate should prices move below the nearby swing low at 115.24 where further sell stops could get activated.
Among the six 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. Although it is usually interpreted as bearish, it has actually shown to be bullish for CHF/JPY. Out of 85 times, CHFJPY closed higher 60.00% 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 54.12% with an average market move of 0.37%.
With four out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are EURUSD losing -0.44% and AUDUSD closing -0.22% lower. On the flipside the best performers have been USDCAD closing 0.68% higher and USDCHF gaining 0.38%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDTRY surging 1.54% and EURTRY closing 1.12% higher. The worst performers of the day have been TRYJPY tanking -1.37% and CADHKD closing -0.67% lower. Read more