EURSEK breaks back below 20-day moving average
Euro/Swedish Krona (EURSEK) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
EURSEK ended the month 0.02% higher at 10.4746 after losing 146 pips (-0.14%) today. Trading 333 pips higher after the open, the pair was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on June 4th, EURSEK lost -0.51% on the following trading day. 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 (EURSEK as at Jun 30, 2020):
Tuesday's trading range has been 728 pips (0.69%), that's below the last trading month's daily average range of 856 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for EURSEK. Prices continued to consolidate within a tight trading range between 10.4407 and 10.5219 where it has been caught now for the last three trading days.
One bearish candlestick pattern matches today's price action, the Bearish Spinning Top.
After trading down to 10.4491 earlier during the day, the currency bounced off the key technical support level at 10.4538 (S1). The failure to close below the support could increase that levels importance as support going forward. EUR/SEK closed back below the 20-day moving average at 10.4865. The forex pair was bought again around 10.4491 after having seen lows at 10.4485, 10.4407 and 10.4488 in the last three trading sessions. Obviously there is something going on at that level.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying might speed up should prices move above the close-by swing high at 10.5554 where further buy stops could get triggered. Selling might accelerate should prices move below the nearby swing low at 10.4407 where further sell stops could get activated. With prices trading close to this year's low at 10.3505, downside momentum might speed up should the FX pair break out to new lows for the year. As prices are trading close to June's high at 10.6008, upside momentum could accelerate should the market mark new highs for the month.
Among the nine market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to prior three Lows" stand out. Its common bullish interpretation has been confirmed for EUR/SEK. Out of 64 times, EURSEK closed higher 53.13% 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 10 trading days, showing a win rate of 57.81% with an average market move of 0.20%.
With four out of the seven Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 0.82% and NZDUSD closing 0.53% higher. On the flipside the worst performers have been USDCAD closing -0.62% lower and USDCHF losing -0.41%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been GBPZAR surging 1.31% and GBPJPY closing 1.16% higher. The worst performers of the day have been USDNOK tanking -1.51% and EURGBP closing -0.9% lower. Read more