HUFUSD pushes through key technical resistance level
Hungarian Forint/US Dollar (HUFUSD) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
Moving higher for the 2nd day in a row, HUFUSD finished Thursday at 0.0031116 gaining 275 pips (0.89%). Trading up to 308 pips lower after the open, the currency managed to reverse during the session as bulls took control ending the day above its opening price. The last time this happened on March 9th, HUFUSD actually lost -1.03% on the following trading day. Closing above Wednesday's high at 0.0030971, the market confirmed its breakout through the previous session high after trading up to 271 pips above it intraday.
Daily Candlestick Chart (HUFUSD as at Mar 26, 2020):
Thursday's trading range has been 709 pips (2.3%), that's slightly below the last trading month's daily average range of 766 pips. Weekly volatility is also lower, being below the market's average weekly trading range. The longer-term, monthly volatility is currently significantly higher than usual for HUFUSD.
One bearish candlestick pattern matches today's price action, the Bearish Hikkake Pattern.
Buyers managed to take out the key technical resistance level at 0.0031094 (now S1), which is likely to act as support going forward.
The trend is clearly bearish, showing an intact downtrend in the short, medium and long-term.
Among the eight market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Price broke through Technical Resistance R1" stand out. While it is usually interpreted as bullish, it has actually shown to be bearish for HUF/USD. Out of 396 times, HUFUSD closed lower 53.79% 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 55.56% with an average market move of -0.31%.