HKDAUD closes within previous day's range
Hong Kong Dollar/Australian Dollar (HKDAUD) Technical Analysis Report for Jul 31, 2020 | by Techniquant Editorial Team
HKDAUD ended the month -3.37% lower at 0.1806 after gaining 13 pips (0.73%) today on high volume. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (HKDAUD as at Jul 31, 2020):
Friday's trading range has been 24 pips (1.34%), that's far above the last trading month's daily average range of 17 pips. Weekly volatility is also higher, being slightly above the market's average weekly trading range. The longer-term, monthly volatility is currently slightly higher than usual for HKDAUD.
Notwithstanding a weak opening the market managed to close above the previous day's open and close, forming a bullish Engulfing Candle. The last time this candlestick pattern showed up on July 23rd, HKDAUD actually lost -0.06% on the following trading day. Additionally, one bullish candlestick pattern matches today's price action, the White Candle.
Prices are trading close to the key technical resistance level at 0.1812 (R1).
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Buying could accelerate should prices move above the close-by swing high at 0.1812 where further buy stops might get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Price Action based market condition "52 Week Low" stand out. Its common bearish interpretation has been confirmed for HKD/AUD. Out of 55 times, HKDAUD closed lower 56.36% 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 nine trading days, showing a win rate of 54.55% with an average market move of 0.01%.