GBPZAR closes within previous day's range
British Pound/South African Rand (GBPZAR) Technical Analysis Report for Feb 14, 2020 | by Techniquant Editorial Team
GBPZAR finished the week 0.18% higher at 19.4616 after losing 451 pips (-0.23%) today. Closing within the prior day's range, prices missed to decisively move beyond the previous day's trading range.
Daily Candlestick Chart (GBPZAR as at Feb 14, 2020):
Friday's trading range has been 2227 pips (1.14%), that's slightly below the last trading month's daily average range of 2623 pips. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for GBPZAR.
One bearish candlestick pattern matches today's price action, the Hanging Man.
Prices are trading close to the key technical resistance level at 19.5506 (R1). After having been unable to move above 19.5165 in the prior session, the pair ran into sellers again around the same price level today, failing to move higher than 19.5350. The last time this happened on February 6th, GBPZAR actually gained 0.76% on the following trading day.
Although GBP/ZAR 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 speed up should prices move above the close-by swing high at 19.5848 where further buy stops might get activated. With prices trading close to this year's high at 19.8607, upside momentum could accelerate should the forex pair be able to break out to new highs for the year. As prices are trading close to February's high at 19.8053, upside momentum might speed up should the currency mark new highs for the month.
Among the three market conditions that our pattern recognition engine identified today, the statistics for the OHLC Patterns based market condition "Hanging Man" stand out. Its common bearish interpretation has been confirmed for GBP/ZAR. Out of 44 times, GBPZAR closed lower 63.64% of the time on the next trading day after the market condition occurred.
With five out of the seven Major FX Pairs closing lower today, the ones that stand out on the negative side are USDCAD losing -0.12% and EURUSD closing -0.08% lower. On the flipside the best performers have been USDCHF closing 0.28% higher and GBPUSD gaining 0.02%. Looking at the other Minor FX Pairs and Crosses, the winners of the day have been USDSEK surging 0.51% and EURSEK closing 0.43% higher. The worst performers of the day have been EURHUF tanking -0.65% and USDHUF closing -0.58% lower. Read more