JPYAUD unable to break through key resistance level
Japanese Yen/Australian Dollar (JPYAUD) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
JPYAUD ended Thursday at 0.015049 edging lower 41 pips (-0.27%). Trading 314 pips higher after the open, the pair was unable to hold its gains as the bears took control ending the day below its opening price. Closing within the previous day's range, prices missed to decisively move beyond the prior day's trading range.
Daily Candlestick Chart (JPYAUD as at Mar 26, 2020):
Thursday's trading range has been 389 pips (2.58%), that's slightly below the last trading month's daily average range of 542 pips. Weekly volatility is also lower, being slightly below the market's average weekly trading range. The longer-term, monthly volatility is currently significantly higher than usual for JPYAUD.
One bullish candlestick pattern matches today's price action, the Last Engulfing Bottom Pattern.
Prices are trading close to the key technical support level at 0.014769 (S1). Unable to break through the key technical resistance level at 0.015373 (R1), the FX pair closed below it after spiking up to 0.015404 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 March 17th, JPYAUD actually gained 3.53% on the following trading day.
Though the market is currently in a short-term downtrend, this could just be a correction, as both the medium and long-term trends are still bullish.
Selling might accelerate should prices move below the close-by swing low at 0.014769 where further sell stops could get activated.
Among the six market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Resistance R1" stand out. Its common bearish interpretation has been confirmed for JPY/AUD. Out of 549 times, JPYAUD closed lower 52.28% 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 five trading days, showing a win rate of 52.46% with an average market move of -0.02%.