GBPCHF pushes through Thursday's high
British Pound/Swiss Franc (GBPCHF) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, GBPCHF finished the month 1.7% higher at 1.1948 after gaining 43 pips (0.36%) today on high volume. Today's close at 1.1948 marks the highest recorded closing price since June 16th. Closing above Thursday's high at 1.1925, the FX pair confirmed its breakout through the prior session high after trading up to 79 pips above it intraday.
Daily Candlestick Chart (GBPCHF as at Jul 31, 2020):
Friday's trading range has been 115 pips (0.97%), that's far above the last trading month's daily average range of 89 pips. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for GBPCHF.
Unable to break through the key technical resistance level at 1.2003 (R1), GBP/CHF closed below it after spiking up to 1.2004 earlier during the day. The failure to close above the resistance might increase that levels importance going forward. When prices bounced off a significant resistance level the last time on July 23rd, GBPCHF lost -0.09% on the following trading day.
Crossing above the upper Bollinger Band for the first time since June 8th, prices have shown unusually strong upward momentum in the short-term. This could either indicate a potential buying climax after which prices might head back down towards the mean of the Bollinger Bands at 1.1847 or signal the beginning of a strong momentum breakout leading to even higher prices.
The trend is clearly bullish, showing an intact uptrend in the short, medium and long-term.
Among the five market conditions that our pattern recognition engine identified today, the statistics for the Technical Indicators based market condition "Close crossed above the upper Bollinger Band" stand out. Though it is usually interpreted as bullish, it has actually shown to be bearish for GBP/CHF. Out of 88 times, GBPCHF closed lower 52.27% 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 55.68% with an average market move of -0.49%.
With five out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are NZDUSD losing -1.04% and AUDUSD closing -0.72% lower. On the flipside the best performers have been USDJPY closing 1.12% higher and USDCHF gaining 0.48%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDZAR surging 1.87% and GBPZAR closing 1.79% higher. The worst performers of the day have been NZDCAD tanking -1.15% and NZDHKD closing -1.05% lower. Read more