CHFZAR finds buyers at key support level
Swiss Franc/South African Rand (CHFZAR) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
CHFZAR ended the month 0.35% higher at 18.3184 after gaining 1613 pips (0.89%) today. Closing within the prior day's range, prices failed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (CHFZAR as at Jun 30, 2020):
Tuesday's trading range has been 2615 pips (1.44%), that's slightly below the last trading month's daily average range of 3087 pips. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently lower than usual for CHFZAR. Prices continued to consolidate within a tight trading range between 18.0559 and 18.4768 where it has been caught now for the whole last trading week.
In a volatile session, prices traded above the prior day's high as well as below the previous day's low, forming a bullish Outside Bar. The last time this happened on May 28th, CHFZAR gained 0.51% on the following trading day. Notwithstanding a weak opening the market managed to close above the prior day's open and close, forming a bullish Engulfing Candle. Additionally, one bullish candlestick pattern matches today's price action, the White Candle.
After trading down to 18.1170 earlier during the day, the forex pair bounced off the key technical support level at 18.1357 (S1). The failure to close below the support might increase that levels significance as support going forward. Prices are trading close to the key technical resistance level at 18.4768 (R1). After having been unable to move lower than 18.1369 in the previous session, the FX pair found buyers again around the same price level today at 18.1170.
The pair shows strength in the short-term supported by its long-term uptrend with only the medium-term trend being bearish.
Buying could speed up should prices move above the nearby swing high at 18.4768 where further buy stops might get triggered. Selling could accelerate should prices move below the close-by swing low at 18.0559 where further sell stops might get activated.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Bullish Engulfing Candle" stand out. Its common bullish interpretation has been confirmed for CHF/ZAR. Out of 94 times, CHFZAR closed higher 54.26% 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 56.38% with an average market move of 0.69%.
With four out of the seven Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 0.82% and NZDUSD closing 0.53% higher. On the flipside the worst performers have been USDCAD closing -0.62% lower and USDCHF losing -0.41%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been GBPZAR surging 1.31% and GBPJPY closing 1.16% higher. The worst performers of the day have been USDNOK tanking -1.51% and EURGBP closing -0.9% lower. Read more