CZKEUR closes below its opening price unable to hold early session gains
Czech Koruna/Euro (CZKEUR) Technical Analysis Report for Oct 23, 2020 | by Techniquant Editorial Team
CZKEUR finished the week 0.24% higher at 0.036744 after edging lower 27 pips (-0.07%) today on low volume. Trading 99 pips higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (CZKEUR as at Oct 23, 2020):
Friday's trading range has been 207 pips (0.56%), that's below the last trading month's daily average range of 288 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 CZKEUR. Prices continued to consolidate within a tight trading range between 0.036530 and 0.036970 where it has been caught now for the whole last trading week.
Three candlestick patterns are matching today's price action, the Doji, the Long-Legged Doji and the Rickshaw-Man which are known as neutral patterns.
Unable to break through the key technical resistance level at 0.036827 (R1), the forex pair closed below it after spiking up to 0.036850 earlier during the day. The failure to close above the resistance could increase that levels importance going forward. After having been unable to move lower than 0.036619 in the previous session, the pair found buyers again around the same price level today at 0.036643. The last time this happened on October 12th, CZKEUR actually lost -0.67% on the following trading day.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying might speed up should prices move above the close-by swing high at 0.036970 where further buy stops could get activated. Selling might accelerate should prices move below the nearby swing low at 0.036619 where further sell stops could get triggered.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Bearish Intraday Reversal" stand out. Although it is usually interpreted as bearish, it has actually shown to be bullish for CZK/EUR. Out of 602 times, CZKEUR closed higher 52.16% 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 52.99% with an average market move of -0.01%.