EURUSD dominated by bears dragging the market lower throughout the day
Euro/US Dollar (EURUSD) Technical Analysis Report for Aug 13, 2019 | by Techniquant Editorial Team
EURUSD finished Tuesday at 1.1172 losing 42 pips (-0.37%). The bears were in full control today, moving the market lower throughout the whole session. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (EURUSD as at Aug 13, 2019):
Tuesday's trading range has been 59 pips (0.53%), that's slightly below the last trading month's daily average range of 60 pips. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for EURUSD.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. Additionally, one bearish candlestick pattern matches today's price action, the Black Candle.
Unable to break through the key technical resistance level at 1.1218 (R2), the market closed below it after spiking up to 1.1229 earlier during the day. The failure to close above the resistance could increase that levels significance going forward. The FX pair was sold again around 1.1229 after having seen highs at 1.1231, 1.1223 and 1.1232 in the last three trading sessions. Obviously there is something going on at that level. The last time this happened on November 1, 2017, EURUSD actually gained 0.34% on the following trading day.
Though EUR/USD is experiencing a short-term uptrend, this might just be a correction, as both the medium and long-term trends are still bearish.
Selling could accelerate should prices move below the close-by swing low at 1.1162 where further sell stops might get activated.
Among the 11 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Resistance R2" stand out. Its common bearish interpretation has been confirmed for EUR/USD. Out of 42 times, EURUSD closed lower 57.14% 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 five trading days, showing a win rate of 57.14% with an average market move of -0.10%.
With four out of the other six Major FX Pairs closing higher today, the ones that stand out on the positive side are USDJPY gaining 1.37% and USDCHF closing 0.76% higher. On the flipside the worst performers have been USDCAD closing -0.14% lower and GBPUSD losing -0.13%. Looking at the Minor FX Pairs and Crosses, the winners of the day have been ZARJPY surging 2.47% and AUDJPY closing 2.08% higher. The worst performers of the day have been CHFZAR tanking -1.83% and EURZAR closing -1.46% lower. Read more