EURNZD rises to highest close since May 29th
Euro/New Zealand Dollar (EURNZD) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving higher for the 8th day in a row, EURNZD finished the month 2.09% higher at 1.7768 after gaining 84 pips (0.48%) today on high volume. Today's close at 1.7768 marks the highest recorded closing price since May 29th. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (EURNZD as at Jul 31, 2020):
Friday's trading range has been 126 pips (0.71%), that's slightly above the last trading month's daily average range of 119 pips. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for EURNZD.
One bullish candlestick pattern matches today's price action, the White Candle.
After having been unable to move lower than 1.7665 in the previous session, EUR/NZD found buyers again around the same price level today at 1.7677. The last time this happened on July 20th, EURNZD actually lost -0.30% on the following trading day.
Crossing above the upper Bollinger Band for the first time since Wednesday, prices have shown unusually strong upward momentum in the short-term. This might either indicate a potential buying climax after which prices could head back down towards the mean of the Bollinger Bands at 1.7428 or signal the beginning of a strong momentum breakout leading to even higher prices.
While 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.
Further buying could move prices higher should the market test June's nearby high at 1.7950.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "White Candle" stand out. Though it is usually interpreted as bullish, it has actually shown to be bearish for EUR/NZD. Out of 541 times, EURNZD closed lower 51.02% of the time on the next trading day after the market condition occurred.
With five out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are NZDUSD losing -1.04% and AUDUSD closing -0.72% lower. On the flipside the best performers have been USDJPY closing 1.12% higher and USDCHF gaining 0.48%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDZAR surging 1.87% and GBPZAR closing 1.79% higher. The worst performers of the day have been NZDCAD tanking -1.15% and NZDHKD closing -1.05% lower. Read more