CHFZAR stuck within tight trading range
Swiss Franc/South African Rand (CHFZAR) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
CHFZAR ended the week -1.52% lower at 15.1872 after losing 802 pips (-0.53%) today. 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 (CHFZAR as at Feb 14, 2020):
Friday's trading range has been 1784 pips (1.17%), that's below the last trading month's daily average range of 2176 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 CHFZAR. Prices continued to consolidate within a tight trading range between 15.0959 and 15.3180 where it has been caught now for the last three trading days.
After trading as low as 15.1201 during the day, the forex pair found support at the 20-day moving average at 15.1484. After having been unable to move lower than 15.1423 in the previous session, the market found buyers again around the same price level today at 15.1201. The last time this happened on February 6th, CHFZAR gained 0.78% on the following trading day.
Although the currency is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Buying might speed up should prices move above the close-by swing high at 15.3180 where further buy stops could get activated. Selling might accelerate should prices move below the nearby swing low at 15.0959 where further sell stops could get triggered.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bullish Bounce off SMA 20" stand out. Though it is usually interpreted as bullish, it has actually shown to be bearish for CHF/ZAR. Out of 206 times, CHFZAR closed lower 55.83% 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 59.71% with an average market move of -0.26%.
With five out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are USDCAD losing -0.12% and EURUSD closing -0.08% lower. On the flipside the best performers have been USDCHF closing 0.28% higher and GBPUSD gaining 0.02%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDSEK surging 0.51% and EURSEK closing 0.43% higher. The worst performers of the day have been EURHUF tanking -0.65% and USDHUF closing -0.58% lower. Read more