EURJPY declines to lowest close since October 10, 2019
Euro/Japanese Yen (EURJPY) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
Moving lower for the 3rd day in a row, EURJPY ended the week -1.02% lower at 118.91 after losing 14 pips (-0.12%) today on low volume. Today's close at 118.91 marks the lowest recorded closing price since October 10, 2019. Trading 29 pips higher after the open, the currency 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 (EURJPY as at Feb 14, 2020):
Friday's trading range has been 47 pips (0.39%), that's below the last trading month's daily average range of 60 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 EURJPY.
One bullish candlestick pattern matches today's price action, the Inverted Hammer.
Unable to break through the key technical resistance level at 119.25 (R1), the forex pair closed below it after spiking up to 119.33 earlier during the day. The failure to close above the resistance could increase that levels significance going forward. After having been unable to move lower than 118.88 in the prior session, EUR/JPY found buyers again around the same price level today at 118.86. The last time this happened on Wednesday, EURJPY actually lost -0.56% on the following trading day.
While still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Among the seven market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Inverted Hammer" stand out. Although it is usually interpreted as bullish, it has actually shown to be bearish for EUR/JPY. Out of 9 times, EURJPY closed lower 66.67% 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 77.78% with an average market move of -1.34%.
With five out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are USDCAD losing -0.12% and EURUSD closing -0.08% lower. On the flipside the best performers have been USDCHF closing 0.28% higher and GBPUSD gaining 0.02%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDSEK surging 0.51% and EURSEK closing 0.43% higher. The worst performers of the day have been EURHUF tanking -0.65% and USDHUF closing -0.58% lower. Read more