EURUSD closes below its opening price unable to hold early session gains
Euro/US Dollar (EURUSD) Technical Analysis Report for Sep 15, 2020 | by Techniquant Editorial Team
EURUSD ended Tuesday at 1.1847 losing 16 pips (-0.13%) on low volume. Trading 38 pips higher after the open, the Euro was unable to hold its gains as the bears took control ending the day below its opening price. The last time this happened on September 1st, EURUSD lost -0.48% 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 (EURUSD as at Sep 15, 2020):
Tuesday's trading range has been 62 pips (0.52%), that's below the last trading month's daily average range of 85 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 EURUSD. Prices continued to consolidate within a tight trading range between 1.1813 and 1.1901 where it has been caught now for the last three trading days.
After having been unable to move lower than 1.1832 in the prior session, the pair found buyers again around the same price level today at 1.1839.
Although the currency is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Buying might speed up should prices move above the nearby swing high at 1.1917 where further buy stops could get triggered. With prices trading close to this year's high at 1.2011, upside momentum might accelerate should the forex pair be able to break out to new highs for the year.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Low close to previous low" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for EUR/USD. Out of 656 times, EURUSD closed lower 51.83% 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 53.05% with an average market move of -0.14%.
With four out of the other six Major FX Pairs closing higher today, the ones that stand out on the positive side are GBPUSD gaining 0.33% and NZDUSD closing 0.19% higher. On the flipside the worst performers have been USDJPY closing -0.26% lower and USDCHF losing -0.03%. Looking at the Minor FX Pairs and Crosses, the winners of the day have been ZARJPY surging 0.94% and USDCZK closing 0.56% higher. The worst performers of the day have been EURZAR tanking -1.4% and USDZAR closing -1.26% lower. Read more