CZKUSD slips to lowest close since December 24, 2019
Czech Koruna/US Dollar (CZKUSD) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, CZKUSD finished the week -0.34% lower at 0.043565 after edging lower 20 pips (-0.05%) today. Today's close at 0.043565 marks the lowest recorded closing price since December 24, 2019. Trading 195 pips higher after the open, the forex pair was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (CZKUSD as at Feb 14, 2020):
Friday's trading range has been 281 pips (0.64%), that's slightly above the last trading month's daily average range of 264 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for CZKUSD.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top. The last time a Bearish Spinning Top showed up on January 22nd, CZKUSD lost -0.45% on the following trading day.
After trading down to 0.043501 earlier during the day, the market bounced off the key technical support level at 0.043553 (S1). The failure to close below the support might increase that levels importance as support going forward. After having been unable to move above 0.043810 in the prior session, the currency ran into sellers again around the same price level today, missing to move higher than 0.043782.
Though the FX pair is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for CZK/USD. Out of 567 times, CZKUSD closed higher 53.26% 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 eight trading days, showing a win rate of 54.32% with an average market move of 0.03%.