EURUSD closes below its opening price unable to hold early session gains
Euro/US Dollar (EURUSD) Technical Analysis Report for Dec 13, 2019 | by Techniquant Editorial Team
EURUSD finished the week 0.55% higher at 1.1121 after losing 10 pips (-0.09%) today on high volume. Trading 46 pips higher after the open, the market was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (EURUSD as at Dec 13, 2019):
Friday's trading range has been 88 pips (0.79%), that's far above the last trading month's daily average range of 45 pips. Weekly volatility is also higher, being way above the market's average weekly trading range. The longer-term, monthly volatility is currently higher than usual for EURUSD.
Notwithstanding a strong opening the pair closed below the previous day's open and close, forming a bearish Engulfing Candle.
After trading down to 1.1112 earlier during the day, the currency bounced off the key technical support level at 1.1116 (S1). The failure to close below the support might increase that levels importance as support going forward. Unable to break through the key technical resistance level at 1.1179 (R1), the Euro closed below it after spiking up to 1.1200 earlier during the day. The failure to close above the resistance could increase that levels significance going forward. When prices bounced off a significant resistance level the last time on Monday, EURUSD actually gained 0.26% on the following trading day.
Although still in a long-term downtrend, the short and medium-term trends both turned bullish already.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Resistance R1" stand out. Its common bearish interpretation has been confirmed for EUR/USD. Out of 509 times, EURUSD closed lower 53.44% 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 54.62% with an average market move of -0.10%.
With four out of the other six Major FX Pairs closing lower today, the ones that stand out on the negative side are AUDUSD losing -0.49% and USDCAD closing -0.12% lower. On the flipside the best performers have been GBPUSD closing 1.2% higher and USDJPY gaining 0.04%. Looking at the Minor FX Pairs and Crosses, the winners of the day have been GBPAUD surging 1.63% and GBPZAR closing 1.37% higher. The worst performers of the day have been EURGBP tanking -1.3% and EURNOK closing -0.64% lower. Read more