CNHUSD dominated by bulls lifting the market higher throughout the day
Chinese Yuan Renminbi/US Dollar (CNHUSD) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving higher for the 4th day in a row, CNHUSD ended Wednesday at 0.1483 surging 8 pips (0.54%). This is the biggest single-day gain in over two months. Today's close at 0.1483 marks the highest recorded closing price since May 3, 2019. The bulls were in full control today, moving the market higher throughout the whole session. Closing above Tuesday's high at 0.1478, CNH/USD confirmed its breakout through the previous session high after trading up to 5 pips above it intraday.
Daily Candlestick Chart (CNHUSD as at Sep 16, 2020):
Wednesday's trading range has been 9 pips (0.61%), that's far above the last trading month's daily average range of 5 pips. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for CNHUSD.
Two candlestick patterns are matching today's price action, the Bullish Closing Marubozu and the White Candle which are both known as bullish patterns. The last time a Bullish Closing Marubozu showed up on Monday, CNHUSD gained 0.41% on the following trading day.
With another close above the upper Bollinger Band, prices are confirming their strong upward momentum in the short-term. A drop back into the Bollinger Band on the next trading day while might signal a potential change in momentum that could lead to a correction back down towards the center of the Bollinger Bands at 0.1460.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the 11 market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "4 Consecutive Higher Closes" stand out. Although it is usually interpreted as bullish, it has actually shown to be bearish for CNH/USD. Out of 36 times, CNHUSD closed lower 61.11% 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 six trading days, showing a win rate of 50.00% with an average market move of -0.01%.