HKDSGD still stuck within tight trading range
Hong Kong Dollar/Singapore Dollar (HKDSGD) Technical Analysis Report for Jun 30, 2020 | by Techniquant Editorial Team
HKDSGD finished the month -1.32% lower at 0.1798 after flat today on low volume. Closing within the previous day's range, prices failed to decisively move beyond the prior day's trading range in a lackluster session.
Daily Candlestick Chart (HKDSGD as at Jun 30, 2020):
Tuesday's trading range has been 6 pips (0.33%), that's below the last trading month's daily average range of 9 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 HKDSGD. Prices continued to consolidate within a tight trading range between 0.1790 and 0.1803 where it has been caught now for the whole last trading week.
Three candlestick patterns are matching today's price action, the Northern Doji and the Shooting Star which are both known as bearish patterns and one neutral pattern, the Doji. The last time a Shooting Star showed up on September 3, 2019, HKDSGD lost -0.45% on the following trading day.
Prices are trading close to the key technical resistance level at 0.1877 (R1). HKD/SGD was bought again around 0.1797 after having seen lows at 0.1796, 0.1794 and 0.1795 in the last three trading sessions. Obviously there is something going on at that level.
Though still in a long-term uptrend, the short and medium-term trends both turned bearish already.
Buying could accelerate should prices move above the nearby swing high at 0.1806 where further buy stops might get triggered. Selling could speed up should prices move below the close-by swing low at 0.1794 where further sell stops might get activated. With prices trading close to this year's low at 0.0000, downside momentum could accelerate should the FX pair break out to new lows for the year. Further buying might move prices higher should the market test May's nearby high at 0.1843. As prices are trading close to June's low at 0.1781, downside momentum could speed up should the forex pair mark new lows for the month.
Among the 12 market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "High close to previous three Highs" stand out. Its common bearish interpretation has been confirmed for HKD/SGD. Out of 67 times, HKDSGD closed lower 52.24% 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 55.22% with an average market move of -0.42%.