EURTRY breaks below Thursday's low
Euro/Turkish Lira (EURTRY) Technical Analysis Report for May 22, 2020 | by Techniquant Editorial Team
Moving lower for the 2nd day in a row, EURTRY finished the week -0.58% lower at 7.4260 after losing 143 pips (-0.19%) today on low volume. Closing below Thursday's low at 7.4313, the pair confirmed its breakout through the prior session low after trading up to 292 pips below it intraday.
Daily Candlestick Chart (EURTRY as at May 22, 2020):
Friday's trading range has been 521 pips (0.7%), that's far below the last trading month's daily average range of 1002 pips. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for EURTRY.
After trading as low as 7.4021 during the day, the forex pair found support at the 50-day moving average at 7.4070. The last time this happened on February 10th, EURTRY gained 0.11% on the following trading day.
Although the currency is currently in a short-term downtrend, this might just be a correction, as both the medium and long-term trends are still bullish.
Buying could accelerate should prices move above the nearby swing high at 7.4902 where further buy stops might get triggered. Selling could speed up should prices move below the close-by swing low at 7.3929 where further sell stops might get activated.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "Closed below last periods low" stand out. While it is usually interpreted as bearish, it has actually shown to be bullish for EUR/TRY. Out of 403 times, EURTRY closed higher 46.40% 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 53.10% with an average market move of 0.55%.
With four out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are GBPUSD losing -0.47% and EURUSD closing -0.44% lower. On the flipside the best performers have been USDCAD closing 0.33% higher and USDCHF gaining 0.08%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDCZK surging 1.09% and USDHUF closing 0.9% higher. The worst performers of the day have been USDMXN tanking -0.58% and SGDHKD closing -0.51% lower. Read more