EURHUF still stuck within tight trading range
Euro/Hungarian Forint (EURHUF) Technical Analysis Report for Jan 11, 2019 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, EURHUF ended the week 0.08% higher at 321.1090 after losing 2400 pips (-0.07%) today on high volume. Trading 8540 pips higher after the open, EUR/HUF 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 failed to decisively move beyond the previous day's trading range in a lackluster session.
Daily Candlestick Chart (EURHUF as at Jan 11, 2019):
Friday's trading range has been 15095 pips (0.47%), that's below the last trading month's daily average range of 18116 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for EURHUF. Prices continued to consolidate within a tight trading range between 320.1880 and 322.7340 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 bearish Outside Bar. The last time this happened on January 3rd, EURHUF lost -0.18% on the following trading day. Additionally, five candlestick patterns are matching today's price action, the Southern Doji which is known as bullish pattern, one bearish pattern, the Gravestone Doji and three neutral patterns, the Doji, the Long-Legged Doji and the Rickshaw-Man.
Prices are trading close to the key technical support level at 320.4540 (S1). Unable to break through the key technical resistance level at 321.7925 (R1), the FX pair closed below it after spiking up to 322.0310 earlier during the day. The failure to close above the resistance could increase that levels significance going forward. The pair was bought again around 320.5215 after having seen lows at 320.7035, 320.7675 and 320.7285 in the last three trading sessions. Obviously there is something going on at that level.
Although the market is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Buying could accelerate should prices move above the close-by swing high at 322.7340 where further buy stops might get triggered. Selling could speed up should prices move below the nearby swing low at 320.1880 where further sell stops might get activated. Further selling could move prices lower should the market test December's close-by low at 319.9055.
Among the 17 market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Southern Doji" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for EUR/HUF. Out of 60 times, EURHUF closed lower 63.33% 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 56.67% with an average market move of -0.14%.
With five out of the seven Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 0.71% and NZDUSD closing 0.69% higher. On the flipside the worst performers have been EURUSD closing -0.27% lower and USDCHF losing -0.09%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been NZDCAD surging 0.98% and GBPCAD closing 0.97% higher. The worst performers of the day have been EURNZD tanking -1.04% and EURGBP closing -0.99% lower. Read more