JPYCAD finds buyers at key support level
Japanese Yen/Canadian Dollar (JPYCAD) Technical Analysis Report for Mar 26, 2020 | by Techniquant Editorial Team
JPYCAD ended Thursday at 0.012791 edging higher 29 pips (0.23%). 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 (JPYCAD as at Mar 26, 2020):
Thursday's trading range has been 186 pips (1.46%), that's below the last trading month's daily average range of 323 pips. Weekly volatility is also lower, being way below the market's average weekly trading range. The longer-term, monthly volatility is currently slightly lower than usual for JPYCAD.
During the whole day, prices traded within the previous day's range, unable to trade above the prior day's high or below the previous day's low forming an Inside Bar. After moving lower in the prior session, JPY/CAD managed to close higher but below the previous day's open, forming a bullish Harami Candle.
After trading down to 0.012749 earlier during the day, the currency bounced off the key technical support level at 0.012755 (S1). The failure to close below the support might increase that levels significance as support going forward. After having been unable to move lower than 0.012742 in the prior session, the market found buyers again around the same price level today at 0.012749. The last time this happened on Tuesday, JPYCAD actually lost -1.86% on the following trading day.
Though the pair 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 speed up should prices move below the close-by swing low at 0.012742 where further sell stops could get activated.
Among the four market conditions that our pattern recognition engine identified today, the statistics for the Support/Resistance based market condition "Bounced off Technical Support S1" stand out. Its common bullish interpretation has been confirmed for JPY/CAD. Out of 511 times, JPYCAD closed higher 53.03% of the time on the next trading day after the market condition occurred. The optimal exit for swing trading this condition on the long side has been after 10 trading days, showing a win rate of 51.27% with an average market move of 0.19%.