CHFNZD finds buyers around 1.5815 for the third day in a row
Swiss Franc/New Zealand Dollar (CHFNZD) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
CHFNZD ended the week -0.96% lower at 1.5823 after losing 35 pips (-0.22%) today on low volume. 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 (CHFNZD as at Feb 14, 2020):
Friday's trading range has been 66 pips (0.42%), that's far below the last trading month's daily average range of 120 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 CHFNZD.
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 Bearish Short Candle and the Black Candle which are both known as bearish patterns. The last time a Black Candle showed up on Wednesday, CHFNZD actually gained 0.30% on the following trading day.
After trading down to 1.5815 earlier during the day, CHF/NZD bounced off the key technical support level at 1.5818 (S1). The failure to close below the support could increase that levels significance as support going forward. The pair found buyers again today around 1.5815 for the third trading day in a row after having found demand at 1.5798 in the previous session and at 1.5803 two days ago.
The forex pair shows weakness in the short-term (in accordance with its long-term downtrend) with only the medium-term trend still being bullish.
Selling might accelerate should prices move below the close-by swing low at 1.5798 where further sell stops could get triggered.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to prior two Lows" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for CHF/NZD. Out of 207 times, CHFNZD closed lower 51.69% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the short side has been after 10 trading days, showing a win rate of 56.52% with an average market move of -0.27%.