EURCAD finds support at 20-day moving average
Euro/Canadian Dollar (EURCAD) Technical Analysis Report for Sep 16, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, EURCAD ended Wednesday at 1.5573 losing 48 pips (-0.31%). Closing below Tuesday's low at 1.5595, the currency confirmed its breakout through the prior session low after trading up to 67 pips below it intraday.
Daily Candlestick Chart (EURCAD as at Sep 16, 2020):
Wednesday's trading range has been 117 pips (0.75%), that's above the last trading month's daily average range of 98 pips. Things look different on the weekly timeframe, where the market's trading range of the last week has been slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for EURCAD.
One bullish candlestick pattern matches today's price action, the Bullish Hikkake Pattern. The last time a Bullish Hikkake Pattern showed up on September 7th, EURCAD gained 0.72% on the following trading day.
After trading as low as 1.5528 during the day, the FX pair found support at the 20-day moving average at 1.5562. EUR/CAD closed back below the 50-day moving average at 1.5597 for the first time since September 9th. The forex pair ran into sellers again today around 1.5645 for the third trading day in a row after having found sellers at 1.5651 in the previous session and at 1.5657 two days ago.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Buying might speed up should prices move above the nearby swing high at 1.5657 where further buy stops could get activated. Selling might accelerate should prices move below the close-by swing low at 1.5510 where further sell stops could get triggered. As prices are trading close to September's low at 1.5429, downside momentum might speed up should the market mark new lows for the month.
Among the 10 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. Although it is usually interpreted as bullish, it has actually shown to be bearish for EUR/CAD. Out of 133 times, EURCAD closed lower 57.89% 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 61.65% with an average market move of -0.37%.
With four out of the seven Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 0.61% and NZDUSD closing 0.27% higher. On the flipside the worst performers have been USDJPY closing -0.47% lower and EURUSD losing -0.25%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been GBPPLN surging 0.81% and ZARJPY closing 0.78% higher. The worst performers of the day have been EURZAR tanking -1.42% and CHFZAR closing -1.28% lower. Read more